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Currency Market Analysis

Jun 25, 2021 | Currency Market Analysis

Global Themes

Greenback lower as US infrastructure deal boosts sentiment

US shares were higher overnight, with the S&P500 and Nasdaq both closing at all-time highs, after US political parties agreed to a USD973 billion infrastructure package.

The deal focused on traditional infrastructure rather than the “human capital” programs that President Biden suggested as part of a broader package.

The US’s Dow Jones gained 1.0%.

Greenback slips

The USD was weaker on the news.

The USDSGD fell 0.3%.

Most other major FX also weakened versus the SGD.

The EURSGD fell 0.2% and the JPYSGD fell 0.2%.

The GBPSGD fell 0.5% after the Bank of England said it still had concerns about the UK’s economic recovery.

Down with PCE

With markets taking a brief hiatus from the US Federal Reserve overnight, the focus quickly returned to monetary policy with the Fed’s favoured inflation measure, the PCE, due at 8.30pm.

The PCE – or personal consumption and expenditure figures – can have a major impact in expectations for the Fed’s next move.

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