Morning Commentary & Currency Insights – April 23, 2018

The dollar has continued riding Friday’s gains to start the week with US Bond Yields on the rise with the Dollar Index up 0.37% this morning, the strongest we’ve seen since March 1^st.  Trade talks between US and China appear to be moving in a positive direction as Treasury Secretary Mnuchin is said to be considering a trip to China with cautious optimism that a trade agreement can be reached between the two nations – China is welcoming the gesture. International tensions are easing after news from North Korea indicated that the regime would be suspending nuclear and missile tests ahead of summits with South Korea and the US. Euro is soft on weak manufacturing numbers that weighed in at the lowest levels we’ve seen in 14 months. Sterling is still looking to pick itself up after last week’s comments by BoE boss Carney, stating that the central bank may hold off on a rate hike in May on concerning wage growth and inflation data. Thursday and Friday are quite busy with Central Bank Rate Decisions out of the ECB on Thursday and BOJ on Friday.

This afternoon at 3:30 EST Bank of Canada Governor Poloz, along with Senior Deputy Governor Carolyn Wilkins, will testify before the House of Commons Standing Committee on Finance, in Ottawa while further NAFTA negotiations will commence this week in Washington, as signatories look to push a deal to the finish line. Short term support and resistance for USD/CAD is 1.2750 and 1.2825 respectively, with the RSI on the rise at a neutral 54 and the 200-day Moving Average residing at 1.2623 – acting as long term support.