US: Consumer confidence and Fed speak in the limelight – Rabobank

Piotr Matys, EM FX Strategist at Rabobank, suggests that the Fed speakers and consumer confidence data will be the key economic events from today’s US session.

Key Quotes

“Fed speakers scheduled today include Chair Janet Yellen who is a keynote speaker at the annual conference of the National Community Reinvestment Coalition. It remains to be seen whether Yellen will provide fresh clues about the pace of the monetary policy tightening by the Fed. The implied probability that the 25bps hike announced earlier in March will be followed by another move in June fell from 53.5% (on March 20) to 50.2% amid fading market expectations about reflation.”

“Given that Chair Yellen usually chooses her words carefully when commenting on the monetary policy, those hoping for some verbal fireworks may favour watching UK Foreign Secretary Boris Johnson who will be answering questions in the parliament on Tuesday. Prime Minister Theresa May will be probably hoping that Mr Boris Johnson does not reveal too many details about the Brexit strategy (if there is one) before she triggers Article 50 on Wednesday and official negotiations with the EU commence.”

“Data wise, the Conference Board Index of Consumer Confidence rose sharply to the highest level since July 2001 in February on the back of rising optimism amongst consumers about President Trump’s policies. However, a modest correction to 114 in March, down from 114.8 previously, is expected according to Bloomberg survey when the latest survey is published at 15:00bst (16:00cet).”