(ABM FN-Dow Jones) The Euro rose significantly on Wednesday from 24 hours ago due to the significant drop in long-term interest rates in the US.
“There are a few scenarios for the outlook for the US economy, much more than those for the European economy, and every change in focus has consequences,” said market analyst Stephane Koepmann of ABM Financial News. “It now appears that there has been more uncertainty about the strength of economic growth or the possibility that the headline inflation index will be significantly above 2 per cent and remain there for a longer period of time,” said Copman.
The market analyst expects the US long-term interest rate, which is trading at around 1.65 percent on Wednesday, versus well above 1.7 percent the day before, to remain a limiting factor for the dollar for now.
Today Copman is looking with great interest at the Federal Reserve meeting minutes, as they were prepared during the last policy meeting of the Central Bank and Chairman Jerome Powell’s input on Thursday in participating in an economic committee.
Powell will have to comment on the Biden government’s master infrastructure plan and its potential impacts on the economy, inflation and monetary policy. We do not expect any changes in it, but the market is sensitive to any addition or omission in any of his arguments. At his side, “says Copman.
The British pound remains somewhat sensitive to Copman in the short term to vaccination developments related to the AstraZeneca vaccine and the fear of stroke and deficiency. “In the long term, the turmoil in Northern Ireland and the anticipation of Scotland’s desire to secede are important factors, especially as it is linked to Brexit,” said Copman.
PMIs for services sectors in the Eurozone and UK indicated an improvement on Wednesday. The Eurozone Services PMI stood at 49.6 in March versus 45.7 in February. The composite index rose from 48.8 to 53.2. The UK services PMI came to 56.3 in March versus 49.5 in February.
In the US, the February Trade Balance will be released this afternoon, followed by the Weekly Oil Inventories.
Speakers today include Charles Evans, President of the Federal Reserve Bank of Chicago, World Bank President David Malpass, and International Monetary Fund President Kristalina Georgieva.
In addition, the G20 finance ministers will meet.
The euro rose 0.1 percent on Wednesday to $ 1.1883. The European currency rose 0.1 percent to 0.8593 pounds. The British pound settled at $ 1.3830 on Wednesday. The dollar rose 0.1 percent to 6.5469 Chinese yuan. The dollar rose 0.1 percent today to trade at 109.8640 yen.
ABM Financial News; [email protected]; Revised text: +31 (0) 20 26 28999.
From Beursplein 5, eds ABM Financial News Developments on stock exchanges, and the Amsterdam Stock Exchange in particular, are closely watched. The information in this column is not intended as professional investment advice or as a recommendation to make specific investments.