Email| 10-Year: -06/32....%.... GNMAs: .... USD/JPY: 101.82.... EUR/USD: 1.2979 |
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Retail Sales: Actual +0.1%, consensus -0.3%, prior -0.4% (revised -0.5%) Retail Sales ex-auto: Actual -0.1%, consensus -0.2%, prior -0.4% Business Inventories: Actual 0.0%, consensus 0.3%, prior 0.1% (revised 0.0%) |
Currencies Trade in a Tight Range: The Dollar Index is little changed this morning. The DXY has been trading in a tight range to start the week moving between the 83.07-83.36 levels. Over the weekend, the WSJ's Jon Hilsenrath, considered by many to be a mouth piece for testing Fed plans, wrote an article discussing the potential for the Fed to pull back from its current programs. Really nothing new was introduced as it discussed how the Fed was data dependent. There is a growing expectation that the Fed may look to slowly withdraw its program in the summer. Retail sales data this morning came in better than feared, but it has not had a major impact on the markets.
- The euro has been trading in the 1.2940-1.3000 range. An EU Meeting kicks off today, but there is little expected to emerge from the group. Over the weekend, there was an article discussing the potential for the ECB to purchase ABS, but ECB president Mario Draghi lowered expectations for such a program at this weekend's G7 meeting.
- The pound has slipped back to test the 1.5350 area this morning. The move is a little surprising given expectations that the Bank of England would raise its growth outlook for 2013 in its upcoming inflation report.
- The yen remains a key story for the markets. Dollar/yen hit 102 in early action as the G7 failed to call out Japan for its current monetary policies. This was widely expected so some of the early weakness has been erased. But the yen still remains in a downward trend as Abenomics takes hold. It is currently trading at 101.76 against the dollar.
