The direction of the dollar exchange rate is confused this week. The trend of dollar depreciation since March has come to a halt, and the exchange rate alternates between dollar appreciation and depreciation on a daily basis. The dollar index flow has stagnated and is converging at the 10+21 day line.
The US FOMC’s interest rate hike is almost set at 25bp in May, and there is a minority of speculation that the next rate hike will be left unchanged in June. Inflation indicators remain high in the UK, and the next MPC is expected to raise interest rates by 25 basis points. Although the ECB hinted at a series of rate hikes in the future, views are divided between 25bp and 50bp on the rate hike.
The dollar-yen and cross-yen exchange rates are weak today. Japan’s consumer price index, which was announced in the morning, remained at a high level and did not fall as much as expected. It seems that the situation is such that the Bank of Japan’s decision-making meeting on the 28th of next week will allow the monetary policy to be revised.
The market is reacting nervously to sentiment indicators, especially inflation indicators. Currently, UK retail sales are showing weak figures, putting pressure on the pound to sell. In overseas markets, the preliminary figures for the manufacturing and non-manufacturing PMIs (April) for France, Germany, the Eurozone, the United Kingdom and the United States will be released later. In Canada, retail sales (February) will be announced.
I have repeatedly entered with a US dollar selling perspective, but the trend has not come out easily, and the weekly s system is not growing as expected. However, the April manufacturing PMI in the US is a high-impact indicator, so it is assumed that there is a possibility that this will turn into a trend towards the USD.
Yesterday’s position has already stopped out buying AUDUSD, and the current position is only selling USDCHF.
