The US Dollar Recovered Some Losses. Geopolitical Events Are Still In The Spotlight

Fundamental analysis of Forex market

Yesterday, the US dollar strengthened against a basket of major currencies. Positive economic data supported the US currency. Initial jobless claims fell to a 40-year low (196K), while experts expected 211K. The producer price index rose by 0.6% in March instead of the expected growth by 0.3%. The dollar index (#DX) closed yesterday in a positive zone (+0.26%).

Uncertainty concerning Brexit remains. The delay of the UK exit from the EU prevented the “hard” Brexit scenario, which was supposed to happen this Friday. However, this decision did not make investors happy. The European Union does not intend to revise the draft agreement, that means that there is a possibility that Prime Minister Theresa May will not be able to enlist the support of Parliament during these 6 months. So no-deal Brexit is still not excluded.

After continuous disputes, the EU countries agreed to start negotiations with the US on trade terms simplification. EU members intend to give the European Commissioner for Trade, Cecilia Malmstrom, a negotiating mandate to prevent the United States from imposing fines on European-made cars on April 15. It should be recalled that the United States and the European Union agreed to start preparing negotiations on free trade in July 2018.

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The “black gold” prices have moved away from annual highs. At the moment, futures for the WTI crude oil are testing the mark of $64.00 per barrel. At 20:00 (GMT+3:00), a report on the US Baker Hughes total rig count will be published.

Market Indicators

  • Yesterday, the bearish sentiment was observed in the US stock market: #SPY (-0.03%), #DIA (-0.08%), #QQQ (-0.24%).
  • The 10-year US government bonds yield fell slightly. Currently, the indicator is at the level of 2.49-2.50%.

The news feed for 2019.04.12:

  • Industrial production in the eurozone at 12:00 (GMT+3:00);
  • Export and import price indexes in the US at 15:30 (GMT+3:00);
  • Michigan consumer expectations and sentiment at 17:00 (GMT+3:00)

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