· The euro slumped to a 22-month low against the U.S. dollar on Wednesday after a surprise drop in a leading indicator for economic activity in Germany highlighted the divergence between economic data in the United States and the euro zone.
German business morale deteriorated in April, bucking expectations for a small improvement, as trade tensions hurt the industrial engine of Europe’s largest economy.
The euro fell 0.54% to $1.1164, close to the lowest it has been since early March.
The greenback, by contrast, was supported by strong U.S. housing data, the latest signal the American economy is outperforming rivals.
The dollar index, which measures the U.S. currency versus a basket of six major rivals, was up 0.35% at 97.98, its highest since June 2017.
Investors will watch the release on Friday of U.S. gross domestic product data for the first three months of 2019, for signs of whether the United States remains stronger than other leading economies.
· The Bank of England is likely to keep interest rates on hold until August 2020 because of a slower global economy and prolonged uncertainty about Brexit, a leading think tank said on Thursday.
The National Institute of Economic and Social Research pushed back by a year its previous forecast of a BoE rate hike which it made as recently as February.
· The Bank of Japan is expected to keep monetary policy steady on Thursday and predict that inflation will fall short of its 2 percent target for three more years, signaling that its massive stimulus will stay in place for the foreseeable future.
· Oil prices steadied on Wednesday near six-month highs after data that showed U.S. stockpiles rose to their highest since October 2017, countering fears of tight supply resulting from OPEC output cuts and U.S. sanctions on Venezuela and Iran.
U.S. West Texas Intermediate crude futures settled 41 cents lower at $65.89 per barrel, down more than half a percent. The contract hit $66.60 a barrel on Tuesday, highest since Oct. 31.
Brent crude futures rose 6 cent to $74.57 per barrel, eking out a new six-month closing high. The international benchmark reached $74.73 a barrel on Tuesday, its highest intraday level since Nov. 1.
· U.S. crude inventories rose 5.5 million barrels last week, the Energy Information Administration said, far more than analysts’ forecast of an increase of 1.3 million barrels.
Reference: CNBC, Reuters
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