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US Dollar Lower For a Third Day

CURRENCY FUTURES

The U.S dollar index is lower for a third day.

The euro currency is higher despite a report that showed German consumer prices declined in September for the third consecutive month.

German consumer prices fell 0.2% on month and on the year as measured by national standards. Economists had forecast that prices would remain unchanged on a monthly basis and year-on-year.

The euro zone September consumer confidence index was -13.9 as predicted. In August the index was -14.7.

The British pound advanced following declarations from a senior E.U. official underlining the bloc’s commitment to a negotiated post-Brexit outcome.

In addition, the pound was supported by news that the number of mortgage approvals in the U.K. jumped in August to the highest level since October 2007.

The Australian dollar is higher after a report showed Australian consumer confidence increased by 1.6% last week, which was the fourth consecutive gain.

STOCK INDEX FUTURES

U.S. stock index futures are a little lower today after strong gains yesterday.

A weaker tone to today’s trade is linked to a pared-down stimulus proposal from congressional lawmakers.

The 9:00 central time September consumer confidence index is expected to be 88.8.

S&P 500, Dow and NASDAQ futures have recently advanced above downtrend lines that started in early September.

INTEREST RATE MARKET FUTURES

Federal Reserve speakers today are John Williams at 8:15, Patrick Harker at 8:30, Richard Clarida at 10:40, Randal Quarles at 12:00, John Williams at 12:00 and Randal Quarles at 2:00.

Interest rate market futures at the short end of the curve are likely to be supported by ideas that major central banks, including the Federal Reserve, will keep short term interest rates low for an extended period. Many analysts believe it will be several years, possibly not until 2023, before the Federal Reserve will be in a position to hike its fed funds rate, which currently stands at zero to 25 basis points.

However, futures at the long end of the curve, especially the 30-year Treasury bond futures may be undermined by the inflationary aspects of the Federal Reserve’s “average inflation targeting” policy, along with the potential for a global economic recovery.

Financial futures markets are predicting there is a 98.8% probability that the Federal Open Market Committee will keep its fed funds rate unchanged at the November 4-5 policy meeting.

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Futures and options trading involve significant risk of loss and may not be suitable for everyone.  Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.  The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM.  The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared.  The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.

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