Daily Alert: Thursday 13th April 2017

Mark NugentApril 2017, Daily Alert

Forex Analysis for Thursday 13th April 2017

Economic Calendar

Wednesday: CAD saw rate unchanged at 0.50%.

The BOC said 1) The forecast for the output gap closing moves forward to H1 2018, 2) no improvement in labour market indicators over the past year and 3) it is too early to conclude that the economy is on a sustainable path.

New forecasts: GDP: Q1 2.2% (Prev. 1.5%); CPI: Q1 2.0% (Prev. 1.8%)

BoC Governor Poloz says the BoC is decidedly neutral and a rate cut remains a possibility if risks in outlook are realised but says given the recent data a rate cut was not on the table at present. BoC deputy governor Wilkins judges the neutral rate to be lower now than previously expected; economy has material room to grow.

Comments from President Trump: the USD is getting too strong and he prefers low interest rate policy. This resulted in USD weakening against its major counterparts, in which Trump added that is likely he will not offer Fed Chair Yellen a second term.

Market Reaction

The USD takes a knock as Trump talks down the currency. The risk-off theme continues with global equities dropping, gold rising, the US 10 Year Treasury dropping solidly through support and the JPY strengthening. CAD consolidates while AUD and NZD rise on good Chinese data (this morning, Thursday) and good employment data in Australia.

News Media

Trump weakens USD but at odds with economy
Trump tanks USD but it will bounce back say analysts

Today’s Calendar

A quiet day.

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