Little Change in Dollar after Long Thanksgiving Holiday Break

November 27, 2017

The dollar turned into the final week of November, showing no overnight net movement against the loonie, Australian dollar or sterling, a dip of 0.1% against the euro and a 0.1% uptick relative to the Swiss franc. Slightly larger declines of 0.4% have occurred against the kiwi and yen.

Commodity prices fell rather significantly. West Texas Intermediate crude oil dropped 1.3% to $58.17 per barrel, and both copper and nickel also have lost at least 1.0%. Comex gold, in contrast, rose 0.9% and at $1,302.09 is hovering near a six-week high.

Stocks are mostly lower. Markets declined 1.4% in South Korea, 1.2% in Hong Kong, 1.0% in Taiwan and Italy, 0.9% in China, 0.6% in France, 0.5% in Germany, and 0.2% in Japan. The DOW is up merely 0.2% following a stellar report on U.S. new home sales, which leaped 6.2% in October to 18.7% above their year-earlier level.

Ten-year sovereign debt yields are unchanged in the United States, Canada and Switzerland, up a basis point in Japan and Great Britain and a basis point lower in Germany.

Japanese corporate service prices firmed 0.2% in October, depressing their year-on-year increase back to August’s 0.8% from 0.9% in September.

Chinese industrial profits registered another strong on-year advance of 25.1% in October. This lifted the year-to-date year-over-year increase to 23.3% from 22.8% in September, 21.6% in August and 21.2% in July. China’s ten-year bond yield remains elevated at 4.0%.

Italian consumer confidence fell 1.7 points to a 3-month low reading of 114.3. The economic sentiment index printed 0.3 points lower at 108.8, a 2-month low. Confidence in manufacturing fell 0.9 to a 2-month low, while construction improved 1.8 points to a 2-month high.

Finnish consumer confidence edged marginally lower in November. Such also softened in October.

Mexico and Hong Kong experienced trade deficits in October of $1.54 billion and HKD 43.96 billion, respectively.

The drop-off in the Dallas Fed manufacturing index from a 10-year high of 26.7 in October far surpassed expectations, as such printed at a 3-month low of 19.4.

Several Federal Reserve officials including Chair Yellen will be speaking publicly this week, and the senate confirmation hearings of incoming Chairman Jay Powell will begin. The Republican congressional scramble to pass a tax cut bill will kick into a higher gear.

Copyright 2017, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

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