This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Economic Weakness Boosts Dollar, Yen

NEW YORK ( BBH FX Strategy) -- The U.S. dollar is broadly firmer after weaker-than-expected data reports in China and the eurozone. The euro is erasing earlier gains and breaking below this week's previous lows around 1.313 after March's Purchasing Managers' Index composite disappointed expectations, even in Germany, with readings below the boom-bust level of 50.

Follow TheStreet on Twitter and become a fan on Facebook.

Sterling is down after February retail sales also disappointed. The dollar is softer against the yen, with USD-JPY breaking below 83.0. Global stocks are mixed, with the MSCI Asia up 0.4%. Despite the softer data, policy action gave some investors hope that China will ease policy further.

European stocks are faring much worse, down for the fourth day. The EuroStoxx 600 is down 1.1% with bank shares down nearly 1.5%.

Portuguese yields are coming down for a second day, despite a general strike organized by unions as a protest against the government's austerity measures.

Oil prices are down today from soft data worldwide, which is the lone bright spot today since high oil remains a big risk to the global recovery.

The theme of the day is one of economic weakness. New Zealand GDP (0.3% quarter over quarter vs. 0.7% previously), HSBC China PMI (48.1 vs. 49.6 previously), eurozone PMI composite (48.7 vs. 49.3 previously), and UK retail sales (-0.8% month over month vs. 0.6% previously, ex-auto fuel) all came in weaker than expected.

While some of these numbers can be volatile, the timing of the reports couldn't be worse given rising concerns in recent days about a China hard landing along with softer global growth. German manufacturing PMI was particularly weak, falling to 48.1 vs. an expected rise to 51.

Needless to say, the high beta currencies are taking it on the chin today while the dollar is largely firmer. Despite this week's corrective trade, most currencies remain within this month's trading ranges. Notable exceptions are AUD and ZAR, with the dollar today making new highs against them for March. The dollar seems likely to remain firm for now, but we need to see more trading ranges broken before declaring that the next leg of the dollar rally is upon us.
1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $110.72 -0.53%
FB $92.40 -0.43%
GOOG $642.24 -0.50%
TSLA $231.83 -4.00%
YHOO $31.88 3.00%


Chart of I:DJI
DOW 16,912.29 +122.10 0.73%
S&P 500 1,995.83 +15.91 0.80%
NASDAQ 4,791.1520 +42.7910 0.90%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs