Dollar Firms as Markets Brace for Hawkish Fed Shift, Swiss Franc Under Pressure
| Action Insight Daily Report 5-1-24 |
Dollar Firms as Markets Brace for Hawkish Fed Shift, Swiss Franc Under Pressure |
Dollar rebounded broadly overnight and stayed generally firm in Asian session. Stock investors were apparently adopting a cautious stance and lightening up positions ahead of Fed's rate decision and subsequent press conference today. With recent data pointing to persistent inflationary pressures, expectations are mounting that Fed would adopt a more hawkish tone. It's a minimum that Fed will indicate that rate cuts would only be considered once inflation consistently moves towards the target. The central question now is the extent of this hawkish shift. For now, the selloff in the currency markets seemed to be concentrated most in Swiss Franc primarily due to diverging monetary path with other major central banks. While SNB has already begun policy easing, other central banks, including even ECB, may not ease as aggressively as previously anticipated. This disparity in central bank policies is contributing to Franc's weakness... |
USD/CHF Daily Outlook Daily Pivots: (S1) 0.9128; (P) 0.9162; (R1) 0.9231; More.... USD/CHF's rally from 0.8332 resumed and hit as high as 0.9215 so far. Intraday bias is back on the upside for 0.9243 resistance next. Decisive break there will carry larger bullish implications. Next target will be 61.8% projection of 0.8728 to 0.9151 from 0.9009 at 0.9270. For now, near term outlook will stay bullish as long as 0.9087 support holds, in case of retreat. | |
| GMT | Ccy | Events | Actual | Forecast | Previous | Revised |
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| 22:45 | NZD | Employment Change Q1 | -0.20% | 0.30% | 0.40% | | 22:45 | NZD | Unemployment Rate Q1 | 4.30% | 4.30% | 4.00% | | 22:45 | NZD | Labour Cost Index Q/Q Q1 | 0.80% | 0.80% | 1.00% | | 00:30 | JPY | Manufacturing PMI Apr F | 49.6 | 49.9 | 49.9 | | 08:30 | GBP | Manufacturing PMI Apr F | 48.7 | 48.7 | | 12:15 | USD | ADP Employment Change Apr | 180K | 184K | | 13:30 | CAD | Manufacturing PMI Apr | 50.2 | 49.8 | | 13:45 | USD | Manufacturing PMI Apr F | 49.9 | 49.9 | | 14:00 | USD | ISM Manufacturing PMI Apr | 50.1 | 50.3 | | 14:00 | USD | ISM Manufacturing Prices Paid Apr | 55.6 | 55.8 | | 14:00 | USD | ISM Manufacturing Employment Index Apr | 47.4 | | 14:00 | USD | Construction Spending M/M Mar | 0.30% | -0.30% | | 14:30 | USD | Crude Oil Inventories | -2.3M | -6.4M | | 18:00 | USD | Fed Interest Rate Decision | 5.50% | 5.50% | | 18:30 | USD | FOMC Press Conference |
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