The movement of the dollar market has been somewhat chaotic this week. The trend of the dollar’s strength since February has not reached a turning point, but in the past few days there have been signs of adjustment. The dollar/yen exchange rate has risen to the 136 yen level, leading the dollar’s rise, but it is also pointed out that there is pressure to sell the yen due to speculation that Ueda’s new regime is likely to start with continued easing for the time being.
Behind the strong dollar trend is the unexpected strength of a series of US economic indicators. In particular, the firmness of inflation indicators and the upward pressure on wages due to the strength of employment indicators are pointed out. Today, the US MBA mortgage application index, US manufacturing PMI/confirmed figures (February), US construction spending (January), US ISM manufacturing index (February) will be released. The PMI is a confirmed figure, so it does not seem to have the same impact as the preliminary figures. Attention will likely be focused on the ISM Manufacturing Index. Market expectations are expected to rise to 48.0 from the previous 47.4. A higher-than-expected rally would increase the likelihood of a resurgence in dollar buying.
Pay attention to the US ISM Manufacturing Index at 24:00. It is assumed that the flow of USD may change again from here.
Buying NZDCAD is an entry considering the future policy rates of the two countries. While NZ is still moving toward aggressive interest rate hikes, the CDD is currently discussing a halt to rate hikes.