| Time | Country | Event | Period | Previous value | Forecast | Actual |
|---|
| 06:00 | Germany | Industrial Production s.a. (MoM) | March | 1.7% | -0.6% | -0.4% |
During today's Asian trading, the US dollar rose slightly against major currencies, extending yesterday's gains, while market participants continue to analyze economic data and statements by Fed policymakers in an attempt to get clues about the Central Bank's further actions.
The US Dollar Currency Index (DXY), which tracks the dynamics of the dollar against six currencies (euro, swiss franc, yen, canadian dollar, pound sterling and swedish krona) rose by 0.10% to 105.52. Yesterday, the index added 0.26%, despite the fact that Minneapolis Fed President Kashkari suggested the Fed may need to forgo interest rate cuts this year due to stubbornness. Last week, Fed Chair Powell said the wait to loosen policy is taking longer than anticipated, but signaled his inclination is still to cut. For now, the markets see marginally higher chances for two cuts in the U.S. this year, with the first fully baked in for November. According to the CME FedWatch Tool, markets see a 8.9% probability of a 25 basis point rate cut at the Fed meeting in June, a 29.6% probability of a rate cut in July, and a 64.8% probability of monetary policy easing in September.
The yen fell by another 0.35% against the US dollar, again breaking the important psychological level of 155, which increases the risk of another intervention by the Japanese government. However, analysts warn that any intervention will only provide temporary support to the yen, given that there remains a significant difference in interest rates between the United States and Japan. Meanwhile, Bank of Japan Governor Ueda said today that the Central Bank may take monetary policy action if yen declines affect prices significantly, while the country's Finance Minister Suzuki repeated a warning that authorities were ready to respond to excessively volatile moves in the currency market.
The pound fell 0.1% against the US dollar, reaching its lowest level since May 2, while investors are preparing for the meeting of the Bank of England, the results of which will be announced tomorrow. The consensus forecast is that the Central Bank will again keep its rate at 5.25%. However, the statement and updated economic forecasts will be carefully studied in search of any indication of when policy easing may begin.