Dollar Continues to Slide as Commodities Catch a Break

We had a relatively steady day in the markets yesterday as the trend from Friday of dollar depreciation continued through the sessions especially against the commodity currencies and Euro which is back within sniffing distance of 1.1000 again. It wasn’t all one way traffic as UsdJpy continued to rise with the stock markets finishing in the black and oil having a good move back to the topside again.

It was pretty quiet on the fundamental data front but once again we saw lower numbers out of China in the form of Industrial Production data and adding to pressure on the dollar we got a big negative print in the Empire State Manufacturing Index in the US session.

Looking ahead to today and here in Australia we have the RBA’s Monetary Policy Meeting Minutes out at 11.30 am which could promote a bit of further volatility in the Aud, but that’s about it for the Asian session in terms of data releases.

Into the London session and we have the key CPI data out of the UK at 6.30 pm, expected at 2.6%, any disparity from this could see Cable and the sterling crosses start to move out of recent ranges. We also have the flash GDP data from Europe and the German ZEW Economic Sentiment data at 7.00 pm.

In the New York session it’s quite light on the ground with just the Building Permits and Housing Starts due out at 10.30 pm followed by the Industrial Production data 45 minutes later.

So, for today, traders will be looking for a continuation of this move to the downside in the dollar and will be monitoring the commodities closely for further direction and impetus.

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