American FX Outlook: The US government shutdown drives Dollar lower

Mario Blascak, PhD Independent Analyst

What you need to know before markets open:

The US Dollar edged lower on Monday as investors are weighing the impact of the US government partial shutdown that came into force over the weekend.
The German Social Democrats voted in favor of entering the coalition talks with Angela Merkel’s CDU/CSU.
The global economic outlook for is positive, but world’s elite is worried as it gathers for the World Economic Forum in the Swiss town of Davos for the annual conference.
The US Senate is set to continue to reach the deal bringing the US government back to life.

Monday’s market moving events

ECB President Mario Draghi and the executive board member Benoit Coeure are set to participate at the Eurogroup meeting in Brussels.
IMF releases updated outlook for the world economy.
Chicago Fed index is expected to rise to 0.44 in December
Canada’s wholesale sales are set to increase 0.6% m/m in November.

Major market movers

The US Dollar index fell after the US government shutdown weights on the US Dollar, but the extent of losses concentrate to EUR where the news of German coalition progressing supported the currency together with Bundesbank’s judgment of German economy.
The Canadian Dollar is set to remain unaffected by minor macro data after last week’s Bank of Canada rate hike.

Earlier in Asia/Europe

German coalitions talks are setting the stage for Angela Merkel to become German chancellor for the fourth time in a row.
The German Bundesbank published its monthly bulletin concluding that the German economy ended 2017 in “an excellent” form.

Author

Mario Blascak, PhD

Independent Analyst

Dr. Mário Bla&scaron;čák worked in professional finance and banking for 15 years before moving to journalism. While working for Austrian and German banks, he specialized in covering markets and macroeconomics.

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