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Markets Mark Time as Nvidia Earnings Loom

As the hours tick down to this week’s key event risk – Nvidia’s latest earnings release – currency traders are moving to the sidelines and bidding up the greenback. The dollar is climbing against its major rivals, Treasury yields are declining, and North American equity indices are holding firm. The Mexican peso is the clear outperformer on the currency league tables this morning, bouncing back from yesterday’s losses as fears of a diplomatic crisis abate. The exchange rate dropped in yesterday’s session after a constitutional committee approved Andrés Manuel López Obrador’s plan to remove checks and balances in the country’s...

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Hanging in there

• Range bound. Limited moves across most markets. News flow has been light. USD drifted lower. AUD & NZD towards the top of their respective ranges.• Iron ore. The revival has continued. Iron ore prices now over 11% above mid-August lows on the back of signs oversupply risks are easing.• AU inflation. Monthly CPI due today. A lot of uncertainty because of electricity subsidies. A large drop in headline inflation could drag on the AUD. ‘Steady as she goes’ over the past 24hrs with consolidation the main theme across most major markets. News flow has been light. The major European...

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Currencies Lose Momentum as Caution Sets In

The euro, pound, and yen are essentially flat against the dollar this morning as month end flows begin to dominate the foreign exchange landscape, with market participants generally inclined to cut leverage ahead of what could be an extremely dangerous September. Data releases continue to paint a mixed picture of fundamental developments in the US economy. Yesterday’s July durable goods report beat expectations on the headline level, but proved disappointing on closer examination. Overall orders climbed 9.9 percent from the prior month, but this was largely due to a jump in aircraft orders, which rose almost $23.4 billion after falling...

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Holding pattern

• Consolidation. Partial reversal in some markets. US equities slip back while yields & the USD tick up. AUD eased but still near the top of its range.• AU CPI. Monthly inflation due tomorrow. A lot of uncertainty due to electricity subsidies. A large drop in the annual headline rate could weigh on the AUD.• Fed pricing. Markets grappling with whether the US Fed will cut rates by 25bps or 50bps at upcoming meetings. History & the data points to 25bp steps. After the outsized moves last week it isn’t surprising to see that some markets cooled their jets a...

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Dollar Sends Out-of-Office Autoreply

The almighty greenback is making a lacklustre attempt at climbing off the mat after suffering the worst selloff in a year during Friday’s session, with rising geopolitical tensions doing little to reverse its losses. On a trade-weighted basis, the dollar is up incrementally this morning, but has fallen roughly 3 percent this month, pacing declines in Treasury yields even after Israeli airstrikes on Hezbollah targets in Lebanon generated a mild safe haven bid over the weekend. Oil prices are modestly higher, equity futures are seeing cautious inflows, and the pound, euro, and yen are turning in mixed performances amid holiday-thinned...

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