The Dollar Slide Continues as Geopolitical Risk Subsides

Dollar weakness continues to grab the headlines. Economic data from the Eurozone and the U.S will draw some attention, however.
Bob Mason
Wall street, New York, USA.

Earlier in the Day:

It was a particularly quiet day on the Asian economic calendar in the earlier hours of this morning.

There were no material stats to provide direction through the early part of the day.

The lack of stats left the majors in the hands of geopolitical risk sentiment that continued to drag down the U.S Dollar.

For the Majors

At the time of writing, the Japanese Yen was up by 0.31% to ¥109.1 against the greenback. The Aussie Dollar was up by 0.20% to $0.6994, with the Kiwi Dollar up by 0.25% to $0.6716.

The Day Ahead:

For the EUR

It’s a relatively busy day ahead on the economic calendar. After a quiet week last week, German retail sales together with Spanish prelim inflation and 3rd quarter GDP numbers will provide direction.

We can expect the German retail sales figures to have the greatest influence on the day.

From the ECB’s last economic bulletin of the year, the reliance on solid employment conditions and wage growth to support consumer spending remains. Any weak numbers ahead of German unemployment figures at the end of the week will test the EUR’s current run…

The good news is that a phase 1 trade agreement will support the German economy that has been in the doldrums through 2019. That is, assuming of course, that phase 2 of negotiations go smoothly…

At the time of writing, the EUR was up by 0.20% to $1.1199.

For the Pound

It’s a quiet day ahead on the economic calendar, with no material stats due out of the UK to provide the Pound with direction.

With the UK Parliament in recess until 5th January, there’s unlikely to be too much chatter to influence the Pound.

While sentiment continues to be negative, the markets may need to have somewhat more confidence in Johnson delivering on trade within 2020…

At the time of writing, the Pound was up by 0.28% to $1.3114, with Dollar weakness delivering the upside.

Across the Pond

It’s a relatively busy day on the data front. Key stats include December’s Chicago PMI and November goods trade data and pending home sales figures.

Barring particularly impressive figures the stats are unlikely to reverse the Dollar’s recent losses, as geopolitical risk subsides.

On the geopolitical risk front, expect any chatter on trade to provide direction, however.

At the time of writing, the Dollar Spot Index was down by 0.12% to 96.797.

For the Loonie

It’s a quiet day on the economic calendar, with no material stats due out of Canada to provide direction.

A lack of stats will leave the Loonie in the hands of crude oil prices and market risk sentiment.

The Loonie was up by 0.09% to C$1.3067 against the U.S Dollar, at the time of writing, with rising crude oil prices and a weak Greenback delivering the upside.

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