{"id":64537,"date":"2018-05-01T11:12:19","date_gmt":"2018-05-01T11:12:19","guid":{"rendered":"https:\/\/www.biphoo.com\/bipnews\/?p=64537"},"modified":"2018-05-01T11:12:19","modified_gmt":"2018-05-01T11:12:19","slug":"dollar-goes-positive-for-year-before-fed-meeting","status":"publish","type":"post","link":"https:\/\/www.biphoo.com\/bipnews\/business\/dollar-goes-positive-for-year-before-fed-meeting.html","title":{"rendered":"Dollar goes positive for year before Fed meeting"},"content":{"rendered":"

Dollar goes positive for year before Fed meeting<\/span><\/strong><\/h2>\n

The dollar broke into positive territory for the year on Tuesday and bond yields were creeping higher again, as rising oil prices fueled bets that the Federal Reserve will flag more U.S. rate hikes this week<\/span><\/p>\n

May Day holidays in many centers across Asia and Europe meant trading was sparser than usual, though there was more than enough news flow to keep those that were open occupied.<\/span><\/p>\n

The mood at the margins was upbeat after U.S. President Donald Trump extended steel and aluminum tariff exemptions for Europe, Canada and Mexico for another month.<\/span><\/p>\n

There were nerves too. Disappointing British manufacturing and consumer lending figures added to the recent run of European data, worries about Iran\u2019s nuclear deal were keeping oil up, while Apple\u2019s results were due later following recent whispers of weak iPhone demand.<\/span><\/p>\n

It was the dollar though making the running as it turned positive for the year before a two-day Fed meeting expected to pave the way for another two or even three U.S. rate hikes this year.<\/span><\/p>\n

London\u2019s greenback bulls took advantage of the reduced trader presence in the rest of Europe to push it to almost $1.20 per euro and make good ground against the Swiss franc and the data-damaged pound.<\/span><\/p>\n

\u201cProvided the Fed conveys a steady-as-she-goes approach and it isn\u2019t seen to be back tracking – and there is no reason from the data why it should – the dollar should be consolidating and pushing on from this level,\u201d said Bank of New York Mellon senior currency strategist Neil Mellor.<\/span><\/p>\n

He added that the key change has been the move of the U.S. Treasury bond yield to 3 percent last week.<\/span><\/p>\n

It was nudging up at 2.96 percent on Tuesday, which also left the gap between U.S. and German 10-year benchmark bond yields just off its widest level in nearly three decades.\u00a0<\/span><\/p>\n

\u201cIt has been a bit like a dam bursting,\u201d Mellor said of the Treasury move.<\/span><\/p>\n

For Europe\u2019s stocks followers, only London\u2019s FTSE and Denmark\u2019s bourse were open.<\/span><\/p>\n

They were both higher, thanks to the boost to exporters of lower domestic currencies and relief that Trump had postponed steel and aluminum tariffs on the EU, Canada and Mexico and given permanent exemptions to several other allies.<\/span><\/p>\n

U.S. stock futures were steady and in Asia, Japan\u2019s Nikkei closed up 0.2 percent while Australian shares hit seven-week highs as its monster metals sector breathed easier.<\/span><\/p>\n

Apple\u2019s quarterly results are due after Wall Street closes and will be a big focus after several weeks of speculation about ebbing smartphone demand based on selective reports from companies in its supply chain.<\/span><\/p>\n

Technology sector results so far \u2013 at least from the likes of Amazon, Alphabet, Microsoft, Samsung and SAP \u2013 have broadly beaten forecasts for Q1 and the overall aggregate U.S. earnings growth is tracking seven-year highs of almost 25 percent.<\/span><\/p>\n

\u201cEarnings have been really strong so far. Microsoft and Amazon had a bumper quarter. The only concern has been Apple,\u201d said Hirokazu Kabeya, chief global strategist at Daiwa Securities.<\/span><\/p>\n

SUBMERGING MARKETS<\/span><\/p>\n

The stronger dollar was felt widely across commodity markets and the emerging economies that are now borrowing record amounts of debt in the U.S. currency, data from the Bank for International Settlements revealed this week.<\/span><\/p>\n

MSCI\u2019s emerging market index fell 0.4 percent with Russian dollar-denominated stocks chalking up some of the biggest losses and currencies and bonds staying under pressure too.\u00a0<\/span><\/p>\n

Brent oil prices eased off four-month highs of just over $75 a barrel set on Monday on worries that U.S. President Donald Trump may pull out of the 2015 Iran nuclear deal and thereby bring back sanctions on its oil output. [O\/R]<\/span><\/p>\n

The White House said on Monday that information provided by Israel on Iran\u2019s nuclear program had provided \u201cnew and compelling details\u201d.<\/span><\/p>\n

A high-level U.S. trade delegation will be in Beijing for meetings later this week, amid lingering worries about a possible trade war between the world\u2019s top two economies.<\/span><\/p>\n

Copper, which is highly attuned to China\u2019s economy, hit its lowest in three weeks at $6,752 a tonne, accelerating downwards after it broke below its 200-day moving average at $6,800.<\/span><\/p>\n

Source:-https:\/\/www.reuters.com\/article\/us-global-markets\/dollar-goes-positive-for-year-before-fed-meeting-idUSKBN1I22JH<\/span><\/p>\n

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