There is a flock of Fed speakers on the docket for today and the rest of this week with Fed Chair Janet Yellen in a starring role today. Unfortunately, her speech will not have a Q and A afterwards which gives credence to the view that her remarks will not shed any new light on to US monetary policy.
However, Bank of Canada Governor Stephen Poloz’s speech may cause a stir, especially if he continues to down-play recent economic performance and highlights risks to the economy. However, the title of his talk “Canada’s economic history” suggests that the speech will be a non-event for FX markets.
Other than a possible USDCAD reaction to Mr. Poloz’s speech, the rest of this day is shaping up to be a snooze-fest, if overnight action can be a guide. It seems that the short-term FX focus has moved away from the Trump administration actions and shifted back to the Fed. Today is chock full of Fed speakers, (Powell, Kaplan, George,) in addition to Yellen. None of the speakers are expected to light a fire under the greenback, mostly because there are too many data releases between now and the June FOMC meeting.
The US dollar inched higher in early New York trading. The Case-Shiller Home Price Index was unchanged at 5.7%, y/y in January.
Overnight, FX markets were on the comatose side of the equation, although the greenback managed to eke out tiny gains against the G10 currencies except for Sterling and Swiss which were unchanged.
Asia FX was quiet. USDJPY hugged a narrow 110.53-110.82 range, above Monday’s low but still below the March downtrend line. USDJPY trading action may be hampered by Japan year end which is March 31.
The antipodeans were range-bound. AUDUSD tried a bit of a rally in the early going but weak commodity prices overwhelmed the demand and AUDUSD sank to 0.7589. Kiwi stayed in a tight 0.7009-0.7048 range.
Oil prices have inched up from the Asia low of $47.70 and are trading at $48,18 (6:20 am PDT). A bit of profit taking and comments from the Iranian Oil minister opining that the Opec production cut deal would get extended, are behind the move.
USDCAD Technical outlook:
The intraday USDCAD technicals are bullish while prices are trading above 1.3320 supported by the move above 1.3380 which may extend gains to the 1.3430-40 area. A move above 1.3440 would lead to a test of 1.3490. A break below 1.3350 targets 1.3320.
Today’s Range 1.3320-1.3410
Chart: USDCAD 4 hour