SMM news: last week, the dollar bulls burst, breaking through the 98 mark and hitting a two-year high. Although first-quarter GDP data released on Friday were mixed and the dollar fell slightly from its high, it still closed above the 98 mark.
Non-US currencies have tumbled, central banks have put pigeons, Australian inflation data are weak, German business confidence has deteriorated and Brexit fears have weighed on the Australian dollar, the euro and sterling. The Australian dollar and the euro both fell more than 100 points, a more severe decline. Sterling's worst weekly performance in a month, around $1.29, was pressured by the lack of progress in Mrs May's efforts to persuade lawmakers to support its Brexit deal after Easter and the prospect of a resurgence of the Scottish independence movement.
Gold rose more than $10 against the trend last week, closing higher for the first time in two weeks. it was hit near its 200-day moving average at the beginning of the week, but rebounded in the middle of the week to break through $1280 again.
Oil prices fell more than 3 per cent on Friday after US President Donald Trump renewed pressure on Opec to increase its crude oil production to stop it from rising. Analysts said the oil market had experienced its strongest bull market in at least a year, with profit-taking pushing oil prices below the technical stop, which partly exacerbated the decline.
Looking ahead to this week, there will be a pile of big events, with two top central banks on the scene, as well as a pile of big data from the US and Europe. In addition, a number of markets, including Japan, China and parts of Europe, will be closed for the holiday this week. When a bunch of big events and holidays collide, the market is bound to be even more volatile. However, the CFTC report showed that as of April 23, large speculators held as many as 178000 net short positions in VIX futures contracts, and the market appeared to be ill-prepared for possible surprises this week.
[list of events of the week]
1 Monday focused on the US core PCE price index for March, with the initial annual rate of the US core PCE price index for the first quarter released on Friday night at 1.3%, below market expectations of 1.4% and the worst performance since the third quarter of 2017. The market now expects the US core PCE price index to grow at an annualised rate of 1.7 per cent in March from a year earlier, compared with 1.8 per cent. The data is an important reference indicator for the Fed's interest rate decisions and could put the dollar at risk of a pullback if it underperforms.
The Fed will announce the interest rate decision at 2 a.m. on Thursday, and Powell will hold a press conference. At present, the market is widely expected that the Fed will not adjust the level of interest rates, investors should focus on the release of the resolution after the Fed Chairman Powell's speech at a news conference. As US economic data improve, investors should pay attention to whether there are any attitudinal changes in Powell's speech. In addition, in addition to Powell, several other Fed voting committees will also speak this week, including Chicago Fed Chairman Evans, Federal Reserve Vice Chairman Clarida and so on, investors may pay close attention to their speech.
On Thursday night, the Bank of England will also announce an interest rate resolution, as well as inflation forecasts. Foreign media analysis believes that the Bank of England's statement this week may be unexpected "hawk release." Against the backdrop of low unemployment and repeated delays in Brexit, one or two officials are likely to vote for a rise in interest rates this week, raising the pound. Six of the 24 economists surveyed by Bloomberg expect at least one member of the monetary policy committee to call for an immediate tightening of interest rates.
On Friday night, non-agricultural data for April will be released in the United States. At present, the market expects the non-farm payrolls in the United States to increase by 180000 after the April quarter adjustment, down from the previous figure of 196000. If the data deviate too much from expectations, it will cause huge fluctuations in the dollar and gold. In addition, investors should also pay attention to Wednesday's "small non-agriculture", which, as a forward-looking indicator of higher market attention, may provide some guidance for non-agriculture on Friday.