Alfonso Esparza

Week Ahead: Improving European manufacturing balanced euro against dollar

By Alfonso Esparza | June 23, 2017

The U.S. dollar is mixed against major pairs after a week where Fed speakers offered a mixed narrative. The majority of policy makers agree that the massive balance sheet accumulated during the quantitative easing program from the U.S. central bank should start shrinking sooner rather than later. The point of debate remains the number of rate hikes in the horizon, with St. Louis Fed President James Bullard calling it "unnecessarily aggressive."

Week Ahead: Dollar struggles despite Fed rate hike boost

By Alfonso Esparza | June 16, 2017

Economic data released this week has the market questioning how serious the Fed is about its economic forecasts as inflation, retail sales and building permits all came in lower than expected this week. The Trump administration continues to be caught in the turmoil of the Russian connection investigation and it now appears the President will be under investigation doing the dollar no favors.

Week Ahead: Central banks to attempt return to fundamentals

By Alfonso Esparza | June 9, 2017

The euro/U.S. dollar currency pair lost 0.749% in the last five days. The single currency is trading at 1.1193 after the ECB met expectations by keeping the interest rate and quantitative easing program unchanged. The central bank did remove the reference to rate cuts, and President Draghi praised the momentum of the economy, while at the same time warning of weak inflation.

Week Ahead: Dollar struggles after US jobs miss

By Alfonso Esparza | June 2, 2017

The U.S. dollar is lower across the board versus major currencies. The U.S. non-farm payrolls (NFP) grew by 138,000 jobs in May short of the 180,000 forecasted and there were downward revisions to the two previous months. The employment trend continues to be strong as evidenced by the fall in the unemployment rate to its lowest since 2001, 4.3%. The market is still pricing in a 91.2% of a rate hike in June with U.S. Federal Reserve raising interest rates by 25 basis points to the 100–125 basis points range.

Week Ahead: U.S. Political risk and data to guide markets

By Alfonso Esparza | May 30, 2017

The U.S. dollar is regaining momentum after the Commerce Department upgraded its first quarter GDP estimate from 0.7% to 1.2%. The U.S. Federal Reserve was already considering the slowdown a transitory one as per the minutes of its May meeting that were released on Wednesday. U.S. political risk is keeping the USD from taking off as the Russian connection probe is now targeting Trump's son law Jared Kushner. The price of gold has risen as investors look for a safe haven during times of turbulence.

Week Ahead: Political risk to drive dollar

By Alfonso Esparza | May 19, 2017

The U.S. dollar is lower across the board and has given all the 2017 gains to end up near pre-elections levels. The turmoil in Washington continues to be the main driving factor for markets with the potential testimony of former FBI Director James Comey on Wednesday the biggest event risk for the greenback. The U.S. Federal Reserve has sent mixed signals via non-voting members on the path of rate hikes but the market still holds a 78.5 probability of higher rates when the U.S. central bank meets in June.

Week Ahead: Dollar looking to regain momentum

By Alfonso Esparza | May 12, 2017

The U.S. dollar will finish the week ending May 12 higher across the board against major pairs. Despite the dollar rally losing steam as softer economic data was released the U.S. Federal Reserve kept the June rate hike on the table boosting the greenback on a monetary policy divergence basis. The central banks of New Zealand and England issued statements this week and made it clear that there are no rate changes coming soon, unlike the U.S. central bank.

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