Dollar strengthened against its major peers on Monday. Currency sparked to the day’s high after the April survey of business activity in New York state rose for the first time in five months and bolstered expectations the Federal Reserve will raise interest rates in May.
The dollar index, a measure of the currency against six major peers, rose 0.55% after the Empire State Manufacturing index shot to 10.8 from -24.6 in March, far higher than expectations of -18 in a Reuters poll of 35 economists.
A strong dollar resulted in profit booking in commodity prices. Gold prices retreated 0.25% and Silver prices dropped more than 1.10% yesterday. Base Metals also settled in red. Copper prices down by 1.05%, Aluminum down by 0.26%, ZINC and Lead down by 0.22%, 1.17% respectively.
Crude oil also retreated more than 1.95%, while Natural gas was able to gain 8.62%.
Today Economic data and events to watch
China
At 7.30 am – China GDP q/y, data is foreseen slightly higher at 3.9% from 2.9%.
Fixed Asset Investment ytd/y, data is foreseen higher at 5.8% from 5.5%.
Industrial Production y/y, data is foreseen much higher at 4.7% from 2.4%.
NBS Press Conference
Retail Sales y/y, data is foreseen much higher at 8.0% from 3.5%.
Unemployment Rate data is foreseen lower at 5.5% from 5.6%.
All above data is expected to have a bullish impact on base metals.
U.K.
At 11.30am – Claimant Count Change. Data expect to expand by 10.2K from contraction of -11.2K.
Average Earnings Index 3m/y. Data is foreseen at 5.1% lower from previous 5.7%.
Unemployment Rate data is foreseen at 3.7% unchanged from previous 3.7%.
All above data expect to have a negative impact on the Pound.
Eurozone
At 1.30 pm – Italian Trade Balance, data is foreseen at -3.23B from -4.19B.
At 2.30pm – German ZEW Economic Sentiment, data is foreseen at 15.5 higher from 13.0.
Trade Balance, data is foreseen at -8.5B, recovered from -11.3B.
ZEW Economic Sentiment, data is foreseen at 12.2 slightly higher from 10.0 previous.
All above data expect to have a positive impact on Euro and bullions.
Canada
At 6.00 pm – CPI m/m, data is foreseen at 0.6% higher from previous reading of 0.4%.
Core CPI m/m, data is foreseen NA. Previous was 0.5%.
At 8.30pm – BOC Gov Macklem Speaks.
All above data expect to have a volatile impact on dollar and base metals.
US
At 6.00 pm – Building Permits, data is foreseen at 1.46M, lower from previous reading of 1.52M.
Housing Starts, data is foreseen at 1.40M. Previous was 1.45M
All above data expect to have a positive impact on the dollar.