What you need to know on Monday, May 17:
The greenback fell on Friday, following worse-than-expected US data. Retail Sales showed no growth in April, down from 10.7% in the previous month, while the core reading fell 1.5%. Also, the preliminary estimate of the Michigan Consumer Sentiment Index resulted in 82.8 in May, down from the previous 88.3 and the expected 90.4. Also, Industrial Production rose a modest 0.7% in April.
Speculation that the US Federal Reserve would need to tighten its monetary policy amid increased inflationary pressures cooled down, to the detriment of the American currency. Stocks surge while government bond yields retreated.
Most dollar’s rivals advanced, with EUR/USD and GBP/USD poised to extend their gains. Among commodity-linked currencies, the aussie is the weakest and the CAD the strongest.
The optimistic market sentiment will be tested at the weekly opening by Chinese data. The country will publish April Retail Sales and Industrial Production, both expected to have advanced at a slower pace than in March.
In the UK, Prime Minister Boris Johnson offered a mixed message over coronavirus developments. On one hand, he said that the government does not believe it would need to delay reopening, as there’s no evidence of stress in the health system. Nevertheless, he noted that there are some important unknowns and that they will remain vigilant.
Over the weekend, the leaders of Ireland and PM Johnson met to discuss a smooth trade relationship with Northern Ireland. The UK macroeconomic calendar has nothing to offer until next Tuesday when it will publish employment-related figures. Brexit-related tensions keep putting a lid on the pound.
Spot gold surged to a fresh three-month high of $ 1,845.88 a troy ounce, ending the week with substantial gains at 1,843. Crude oil prices also advanced on Friday, with WTI settling at $ 65.50 a barrel, unchanged for the week.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.