The dollar will be supported by demand at the end of the quarter
dollar index (DXY00) rose slightly on Wednesday on dollar demand at the end of the quarter. The ECB's dovish comments on Wednesday also pushed down the euro and boosted the dollar. Meanwhile, the yen recovered from a 33-year low and rose on speculation that Japanese authorities may soon intervene in the currency market to support the yen's value.
US weekly MBA home loan applications fell -0.7% for the week ending March 22nd. The Refinance Mortgage Sub-Index decreased by -1.6% and the Purchased Mortgage Sub-Index decreased by -0.2%. The average 30-year fixed rate mortgage fell 4 basis points from 6.97% to 6.93%.
The market is discounting the probability of a -25 basis point rate cut of 15% at the next FOMC meeting on April 30th-May 1st, and 78% chance of a -25 basis point rate cut at the next FOMC meeting on June 11-12th.
EUR/USD (^Eurodollar) fell -0.08% on Wednesday. The euro recorded a slight decline on Wednesday due to dovish comments from ECB Governing Council member Kazakh and ECB Governing Council member Cipollone, who expressed support for an ECB interest rate cut at the June Governing Council meeting. The euro's decline was curbed after Wednesday's better-than-expected euro zone business report.
“Inflation is low and will continue to fall across the euro area,” ECB Governing Council member Kazaks said, adding that June could be a good time for the ECB to start lowering borrowing costs. said.
“If future data confirm the scenario foreseen in the March forecast, the ECB should be ready to quickly reduce its restrictive monetary policy stance,” ECB Governing Council member Cipollone said. Stated.
The Eurozone economic confidence index for March rose by +0.8 to 96.3, exceeding expectations of 96.2.
The swaps factor in a 13% chance that the ECB will cut interest rates by -25 basis points at its next meeting on April 11th, and fully factor in a rate cut (101%) at its next meeting on June 6th.
USD/JPY (^USD Yen) fell -0.13% on Wednesday. The yen rebounded from a 33-year low against the dollar on Wednesday, with Japanese authorities turning to currency markets to support the yen after Japan's Ministry of Finance, Bank of Japan and Financial Services Agency held a meeting of the Financial Services Agency. The rise followed speculation that the government was preparing to intervene. Unscheduled meeting.
Comments by Finance Minister Suzuki and Japan's top currency official, Karita, who said they were watching developments in the foreign exchange market “with a high sense of crisis” triggered short-covering of the yen. Finance Minister Suzuki said, “Forex movements of 4% in two weeks are not gradual, and we are closely monitoring market movements with a high sense of nervousness.'' Kanda, the head of the currency authority, said, “The recent depreciation of the yen cannot be said to be in line with fundamentals, and it is clear that speculative movements are behind the depreciation of the yen.'' We will not exclude it and will respond appropriately.” . ”
The swaps factor in the possibility of a +10bp rate hike by the Bank of Japan at 1% at its April 26th meeting and 18% at its next June 14th meeting.
April Gold (GCJ4) Wednesday's closing price was +13.4 (+0.62%), May silver (SIK24) ended at +0.129 (+0.52%). Precious metals prices closed slightly higher on Wednesday. Kim received support on Wednesday with dovish comments from ECB Governing Council member Kazakh and ECB Governing Council member Cipollone. A drop in global bond yields on Wednesday also supported precious metals. Additionally, geopolitical tensions in the Middle East have increased demand for precious metals as a safe haven following the stalling of ceasefire negotiations between Israel and Hamas.
On the downside, Wednesday's strength in the dollar was bearish for metals. Wednesday's rally in stocks also reduced demand for safe-haven precious metals. Silver's gains were limited by negative carryover from Wednesday's drop in copper prices to a two-week low.
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On the date of publication, rich asplund I had no position (directly or indirectly) in any of the securities mentioned in this article. All information and data in this article is for informational purposes only. Please see the Barchart Disclosure Policy for more information. here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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dollar index (DXY00) rose slightly on Wednesday on dollar demand at the end of the quarter. The ECB's dovish comments on Wednesday also pushed down the euro and boosted the dollar. Meanwhile, the yen recovered from a 33-year low and rose on speculation that Japanese authorities may soon intervene in the currency market to support the yen's value. US weekly MBA home loan applications fell -0.7% for the week ending March 22nd. The Refinance Mortgage Sub-Index decreased by -1.6% and the Purchased Mortgage Sub-Index decreased by -0.2%. The average 30-year fixed rate mortgage fell 4 basis points from 6.97% to 6.93%.
The market is discounting the probability of a -25 basis point rate cut of 15% at the next FOMC meeting on April 30th-May 1st, and 78% chance of a -25 basis point rate cut at the next FOMC meeting on June 11-12th.EUR/USD (^Eurodollar) fell -0.08% on Wednesday. The euro recorded a slight decline on Wednesday due to dovish comments from ECB Governing Council member Kazakh and ECB Governing Council member Cipollone, who expressed support for an ECB interest rate cut at the June Governing Council meeting. The euro's decline was curbed after Wednesday's better-than-expected euro zone business report.”Inflation is low and will continue to fall across the euro area,” ECB Governing Council member Kazaks said, adding that June could be a good time for the ECB to start lowering borrowing costs. said.”If future data confirm the scenario foreseen in the March forecast, the ECB should be ready to quickly reduce its restrictive monetary policy stance,” ECB Governing Council member Cipollone said. Stated.The Eurozone economic confidence index for March rose by +0.8 to 96.3, exceeding expectations of 96.2.
The swaps factor in a 13% chance that the ECB will cut interest rates by -25 basis points at its next meeting on April 11th, and fully factor in a rate cut (101%) at its next meeting on June 6th.USD/JPY (^USD Yen) fell -0.13% on Wednesday. The yen rebounded from a 33-year low against the dollar on Wednesday, with Japanese authorities turning to currency markets to support the yen after Japan's Ministry of Finance, Bank of Japan and Financial Services Agency held a meeting of the Financial Services Agency. The rise followed speculation that the government was preparing to intervene. Unscheduled meeting. Comments by Finance Minister Suzuki and Japan's top currency official, Karita, who said they were watching developments in the foreign exchange market “with a high sense of crisis” triggered short-covering of the yen. Finance Minister Suzuki said, “Forex movements of 4% in two weeks are not gradual, and we are closely monitoring market movements with a high sense of nervousness.'' Kanda, the head of the currency authority, said, “The recent depreciation of the yen cannot be said to be in line with fundamentals, and it is clear that speculative movements are behind the depreciation of the yen.'' We will not exclude it and will respond appropriately.” . ”The swaps factor in the possibility of a +10bp rate hike by the Bank of Japan at 1% at its April 26th meeting and 18% at its next June 14th meeting.April Gold (GCJ4) Wednesday's closing price was +13.4 (+0.62%), May silver (SIK24) ended at +0.129 (+0.52%). Precious metals prices closed slightly higher on Wednesday. Kim received support on Wednesday with dovish comments from ECB Governing Council member Kazakh and ECB Governing Council member Cipollone. A drop in global bond yields on Wednesday also supported precious metals. Additionally, geopolitical tensions in the Middle East have increased demand for precious metals as a safe haven following the stalling of ceasefire negotiations between Israel and Hamas.
On the downside, Wednesday's strength in the dollar was bearish for metals. Wednesday's rally in stocks also reduced demand for safe-haven precious metals. Silver's gains were limited by negative carryover from Wednesday's drop in copper prices to a two-week low.
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On the date of publication, rich asplund I had no position (directly or indirectly) in any of the securities mentioned in this article. All information and data in this article is for informational purposes only. Please see the Barchart Disclosure Policy for more information. here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
https://www.nasdaq.com/articles/dollar-sees-support-from-quarter-end-demand The dollar will be supported by demand at the end of the quarter