Talking Points
- Talks of an imminent US recession have disappeared as the US Treasury yield curve has moved away from inversion territory.
- The April ECB meeting on Wednesday is giving traders a reason to lift Euro[1] prices ahead of time.
- Retail traders[2] are starting to change their tune on the US Dollar, and in turn, EURUSD[3] may rally.
Looking for longer-term forecasts on the US Dollar? Check out the DailyFX Trading Guides[4].
The US Dollar (via the DXY[5] Index) is seeing more weakness in the run up to the supersaturated economic calendar on Wednesday, despite the fact that Tuesday’s slate of events is essentially blank (JOLTS jobs report is interesting for economists, not so much for traders). Brexit negotiations are on hold as leaders get set to gather for the emergency summit tomorrow.
US-led Trade Wars Persist
Elsewhere, the US-China trade war talks have simmered, particularly as the Trump administration grapples with how to properly enforce the agreement in China. But a new front may be opening up with the EU over Airbus and Boeing – this may prove to be a new issue traders are forced to deal with in the news moving forward.
US Recession Concerns Have Quieted Down
As the US Dollar has weakened in recent days, it’s worth noting that little of it has to do with concerns about the US economy slipping into recession. Much ado about nothing, it seems: all of the sirens about the US Treasury yield curve inverting have seemingly disappeared. It’s worth noting that long-end US Treasury yields have rebounded in recent days, as seen
