• What are the key risk events in markets this week?
• ECB’s Wunsch says wouldn’t be surprised if rates hit 4% at some point
• Germany April Ifo business climate index 93.6 vs 94.0 expected
• SNB total sight deposits w.e. 21 April CHF 538.4 bn vs CHF 544.1 bn prior
• Bundesbank says German economy likely expanded in Q1
• China reportedly calls for banks to further cut deposit rates

Markets:

• CHF leads, JPY lags on the day
• European equities little changed; S&P 500 futures down 0.1%
• US 10-year yields down 3.5 bps to 3.537%
• Gold up 0.1% to $1,984.04
• WTI crude down 0.1% to $77.61
• Bitcoin up 0.7% to $27,461

It was a relatively slow session to kick start the new week, as markets are still treading with caution after the more mixed showing last week.

Major currencies didn’t do much, though the yen is seen weaker while the dollar trades more mixed across the board. USD/JPY climbed from 134.10 to 134.60 on the session despite the fact that Treasury yields are a little heavier.

Meanwhile, EUR/USD is up around 0.1% now and testing waters back above 1.1000 while AUD/USD is marked down by 0.2% to 0.6680. The changes are relatively light, as traders don’t really have much to work with for now.

European equities started off a little softer, matching the mood in US futures. However, that all switched up after the cash open as stocks gradually pared losses to keep lightly changed at the moment.

After the back and forth action from last week, we might be in store for more of that in early stages of this week before getting to month-end trading, the BOJ policy decision, and some key economic data on Friday.

This article was written by Justin Low at www.forexlive.com.

Jacques
Attali’s dire future is fast becoming a reality: the imperial dominance of the
United States is fading, and the dollar might soon turn into a pumpkin.

Oddly
enough, the blame for this tectonic shift lies with the country itself. The
decision to freeze Russian currency reserves consecutively prompted other
countries hostile to the US to reduce the share of „greenbacks“ in
both portfolios.

According
to the IMF, the dollar’s share in central bank accounts fell by 0.44% to 58.36%
by the end of 2022, the lowest level in 27 years. In absolute terms, the fall
was 8.7% over the year to $6.471 trillion and in euros, 8.5% to $2.27 trillion.

Given
that in the last month Russia, India, Brazil, Kenya, Saudi Arabia, UAE, ASEAN
countries, and China announced their intention to increase the proportion of
national currencies in their export payments, the situation could get even
worse.

The idea
of independence is also gaining prominence in Europe. Just this week, the
French president suggested that the bloc should strengthen its autonomy
vis-à-vis its big brother by reducing dependence on the
„extraterritoriality of the U.S. dollar.“ What a turn of events…

What do
the French propose? Among other things, to sign an agreement similar to the US
Inflation Reduction Act (IRA). Macron also claims that Europe won the
ideological battle to develop the continent’s strategic autonomy.

Further
impetus to de-dollarization could be given by inflation or, rather, by the Fed
itself. The new round of money printing will cause the supply of dollars to
increase and thus lower the price of the dollar. The regulator’s change in tone
could also negatively affect the US
dollar index.

So what
can we do with this information? Although the situation does not look good for
the US currency, this does not mean that it will disappear tomorrow. However,
if the US economic situation worsens, one should think about possible safe
havens such as gold (XAUUSD).

This article was written by ForexLive at www.forexlive.com.