Yesterday, aided by an upside surprise in the JOLTS numbers, the dollar bounced back. This suggests demand for workers for the month of April remained healthy. Fed Bostic commented that he sees the best monetary policy approach for the Fed to be patience. Treasury yields spiked, as did demand for the dollar.
Earlier in the day, CPI numbers from Europe came in lower than expected at 1.9%, seeing a weaker euro across the board.
GDP from Australia missed the mark this morning - growth for Q1 came in at 0.2% versus the expected 0.4%. GBPAUD remains strong.
*Daily move - against G10 rates at 7:00 am, 04.06.25
** Indicative rates - interbank rates at 7:00 am, 04.06.25
Trump's doubling of steel and aluminium tariffs to 50% takes effect today. Fortunately, the UK has secured an exemption from this increase, though the pound remains largely unaffected. Trump has also spoken this morning stating that President Xi of China is “very tough, and extremely hard to deal with”, but this has had very little impact on markets.
More US data is due out today. This is expected to give markets a gauge of how the US economy continues to deal with the impact of Trump's tariffs.
This week has been a rollercoaster for economic data, with the dip in manufacturing figures being offset by impressive JOLTS report numbers, leading to a fluctuating dollar that first dipped and then rebounded.
The Fed’s beige book is also due for release this evening.
The Bank of Canada (BoC) is expected to hold interest rates at 2.75%, with officials likely to indicate clearer signals on how the US trade war will affect the economy.
Read more about the BoC's interest rate decisions here - When is the next Bank of Canada rate announcement?
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