USD Mixed Ahead Of Tomorrow’s FOMC Minutes
Tomorrow marks the release of March’s FOMC Minutes. For the Greenback, it appears that traders are actively pricing in a variety of potential outcomes. Subsequently, the U.S. dollar has traded mixed against the majors with key movers being the EUR/USD (+0.42%), USD/CHF (-0.41%), and USD/CAD (+0.33%).
On the traditional economic news front, there were a few items worthy of note out this morning. Here’s a quick look at the data:
Event Actual Project Previous
IBD/TIPP Economic Optimism 56.4 NA 55.4
JOLTs Job Openings (Feb.) 7.367M 6.995M 7.099M
The key figure in this group of stats is the JOLTS Job Openings numbers for February. The figure came well above projections, reinforcing the strength of last Friday’s robust Non-Farm Payrolls report. So, things are looking up for the American labor market.
Right now, U.S. markets are reacting positively to vaccine news and the possibility of achieving “herd immunity” by mid-summer. In addition, the American indices continue to push all-time highs as traders bet that the coming Biden infrastructure plan will drive equities higher. Given the recent uptick in stocks and influx of stimulus, one has to wonder if tomorrow’s FOMC Minutes will have a surprisingly hawkish tone.
FOMC Minutes Due Out Wednesday
With a little under 24-hours until the FOMC Minutes are due out, the USD/CHF is extending weekly losses. However, the move comes after a nice bump from downside support. In a Live Market Update from last Friday, I outlined a buying opportunity in the USD/CHF. The short-term counter-trend trade was good for 25 pips.
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Overview: It will be interesting to see how the forex digests tomorrow’s FOMC Minutes. While there may not be any bombshell headlines, the Fed is sure to address inflation and Q1 stock market performance. Sooner or later, Unlimited QE will come to an end ― will March’s minutes give us a clue as to when? For now, we’ll just have to wait and see.
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