USD Needs Strong Data Today to Stave Off Pullback

Talking Points:

– DXY Index trade within yesterday’s range, nonetheless streamer reduce once more.

– EUR/USD and USD/JPY continue to be essentially driven by what’s function with US yields and rate differentials.

– See a DailyFX Economic Calendar for today’s data.

Webinar Schedule

Mondays, 7:30 EDT/12:30 GMT: FX Week Ahead: Strategy for Major Event Risk

Wednesdays, 6:00 EDT/11:00 GMT: Trading QA

Thursdays, 7:30 EDT/11:00 GMT: Central Bank Weekly

The US Dollar is slipping behind this morning, nonetheless DXY Index stays within yesterday’s range. A miss of certainty due to meagre sum on process remodel has had traders paring behind prolonged greenback and brief US Treasury positions this week amid fears of a letdown.

In actuality, however, a best remedy to shoring adult certainty over a state of a US economy – and so a Fed’s ability to travel rates dual to 3 times this year – is a array of clever data. Today, we’ll get a dual many critical US information releases of a week, both regarding to a US consumer.

Consumption is a many critical partial of a US economy, generating scarcely 70% of a title GDP figure. The best monthly discernment we have into expenditure trends in a US competence arguably be a Advance Retail Sales report. In December, expenditure strengthened further, according to a Bloomberg News survey, with a title Advance Retail Sales set to boost by +0.7% (m/m) for a third uninterrupted month.

The Retail Sales Control Group, a submit used to calculate GDP, is due in during +0.4% from +0.1% (m/m). Higher consumer certainty after a US elections might be translating into looser purse strings for consumers, that will assistance expostulate US expansion for Q4’16.

Later in a morning, a US of Michigan Confidence guage for Dec will be released. The certainty index is approaching to deposit somewhat reduce to 98.2 as US consumers wait President-elect Trump to yield some-more fact on his taxation and spending policies. November’s burst to 98.5, from a before month’s 92.6, was driven by consumer expectations that Trump would emanate some-more jobs (although salary benefit expectations were limited).

Speaking after November’s pointy rise, U. of Michigan’s Surveys of Consumers Chief Economist Richard Curtin pronounced that auspicious expectations could assistance jump-start expansion before a tangible dramatization of process changes, and form aloft opening standards that will be used to decider a Trump presidency. As US Treasury yields move, so too will a US Dollar.

See a above video for a technical examination of a DXY Index, EUR/USD, GBP/USD, AUD/USD, USD/JPY, Crude Oil, and Gold.

Read more: After Falling on Trump, USD Turns to Fed Speakers for Support

— Written by Christopher Vecchio, Senior Currency Strategist

To hit Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter during @CVecchioFX

To be combined to Christopher’s e-mail placement list, please fill out this form

View a long-term forecasts with a DailyFX Trading Guides.

About author