The dollar is weaker due to dented sentiment after Congress repealed the health care bill. The Empire Manufacturing Index also impacted the dollar.
Bond markets (BND) rebounded sharply after disappointing data on June retail sales and inflation (TIP).
The S&P 500 (SPY) index closed last week at 2,459.27, posting a weekly gain of 1.4%.
The US Dollar Index fell last week to the lowest levels in ten months. In the early hours on Monday, the US Dollar Index is trading with weakness.
Bond yields were all over the place during US Federal Reserve Chair Janet Yellen’s testimony to the Congress.
The US dollar appears to have received a lifeline after US Federal Reserve Chair Janet Yellen’s most recent testimony to US Congress.
In her recent testimony to Congress, Fed Chair Janet Yellen affirmed the view that inflation is expected to stabilize near its target of 2%.
Yellen’s financial outlook remained upbeat, but she pointed to the availability of substantial amounts of capital and liquidity in the banking system as potential vulnerabilities.
The US GDP growth rate in 1Q17 dropped to 1.4%, causing some concern for policy makers.
Despite the strong growth in employment numbers, the Fed’s latest monetary policy report had some comments about slow wage growth.
In its June policy meeting, the Fed has signaled that it will stop replacing maturing securities and slowly reduce the size of its balance sheet.
Retail sales are a leading indicator for any economy. Equity markets (SPY) (QQQ), bond yields (BND), and forex markets (UUP) tend to react to any surprises in retail sales data.
US vehicle sales (CARZ) fell in June to 16.4 million from 16.6 million sales in the previous month.
The Japanese yen continued its negative trend in the holiday-shortened week ended July 7, 2017. The USD-JPY currency pair closed the week at 114.00.
Economic data from the United Kingdom showed unexpected signs of a slowdown last week, with weaker-than-expected data reported in trade, production, and house prices.
The bond markets (BND) have survived better-than-expected US payroll additions last week. The US economy added 222,000 jobs in June 2017 amid broad-based gains.
The US Dollar Index started this week on a positive note but lost momentum as the week progressed. The US Dollar Index is stable early on July 7.
Since the FOMC minutes and the hawkish turn of events at the European Central Bank and the Bank of England, bond yields across the board have been trending higher.
The US equity markets (SPY) haven’t seen any major impacts from the Fed’s policies in the recent past.
The FOMC June meeting minutes that were released on July 5, 2017, indicated that the FOMC members were divided over when to begin shrinking the Fed’s bloated balance sheet.