US Dollar Rises Ahead of Consumer Price Index
The US dollar rose against its major trading partners early Wednesday before the release of consumer price index data for February. Weekly petroleum stocks inventory data are due to be released, followed by Treasury budget data.
Global risk sentiment continued to sour yesterday as President Trump announced he’d double tariffs on Canadian steel and aluminium to 50% and later pulled the threat as Ontario suspended a 25% surcharge on electricity exports.
Markets have been looking for some reprieve from the tariff story, but there are very few signs that stock instability can press Trump to scale back protectionism noise just yet, ING analyst Francesco Pesole said in a note. .
US global tariffs on steel and aluminium took effect today without exemption; the dollar ended the day lower again yesterday but started to rebound overnight.
A quick summary of foreign exchange activity heading into Wednesday showed that USDEUR fell to 1.0906 from 1.0922 at the Tuesday US close but was above a level of 1.0897 at the same time Tuesday morning.
There are no Eurozone data on Wednesday’s schedule. European Central Bank President Christine Lagarde said overnight the increased uncertainty from US trade policy makes the ECB’s inflation-fighting job harder. The next European Central Bank meeting is scheduled for April 16-17.
GBPUSD fell to 1.2943 from 1.2953 at the Tuesday US close but was up from a level of 1.2927 at the same time Tuesday morning. There are no UK data on Wednesday’s schedule. The next Bank of England meeting is scheduled for March 20.
USDJPY rose to 148.6963 from 147.7556 at the Tuesday US close and 147.5034 at the same time Tuesday morning.
Japanese producer prices were flat in February, slowing the year-over-year rate, while manufacturing sentiment turned pessimistic in Q1, according to data released overnight. The next Bank of Japan meeting is scheduled for March 18-19.
USDCAD rose to 1.4415 from 1.4410 at the Tuesday US close and 1.4409 at the same time Tuesday morning. The pair climbed as high as 1.4514 on Tuesday after the Trump administration announced it would double the tariffs on aluminium and steel imports from Canada.
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