Dollar Recovers in Quiet Markets

We saw the dollar come back better bid over the course of yesterday’s trading as no further escalation of the US RoK situation led to an unwinding of some safe haven trades with Chf, Jpy and Gold all taking a bit of a hit. The Dxy climbed 50 points from 93.00 to 93.50 on the day.

Comments from the Fed’s Dudley helped the move as he commented that there could be a move on the balance sheet in September and he still see’s one more rate hike on the cards this year.

Looking ahead to today and we have the RBA’s Monetary Policy Meeting Minutes out this morning which should give some interest to Aussie traders, the main event in the London session will be the UK CPI data with an expected +2.7% y/y and this is followed by the US Retail Sales data a few ours later at the start of the NY session.

Traders will also continue to keep a close eye on the news wires as danger of comments out of the Korean Peninsula and indeed the White House is still at the forefront of participants minds and anything pointing to an escalation will see a flood back to safe haven currencies and a hit on the equity markets.

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