Dollar remains firm in consolidative markets in Asian session today. Better than expected retail sales data propelled US equities higher overnight as Dow 30 closed above 16000 handle again at 16173.24. But overall, there is no clear indication of reversal and DOW, S&P 500 and Nasdaq are having mildly bearish near term outlook. Dollar index's recovery could extend higher but again, we'd be expecting strong resistance from 80 handle to limit upside and bring another fall. Technically, there is no change in dollar's outlook against other major currencies in the forex markets. EUR/USD, GBP/USD and AUD/USD remains near term bullish while USD/CHF, USD/JPY and USD/CAD are staying near term bearish. The economic calendar today is rather busy with special focus on inflation data from Swiss, UK and US.
The RBA minutes suggested policymakers were happy with the signs of economic recovery in Australia. They acknowledged the signs of a shift of economic structure from mining to non-mining investment. As mentioned in the minutes, "while falling mining investment and weak public demand were set to constrain growth for some time, there were early promising signs in other parts of the economy. In particular, a strong pick-up in dwelling investment was in prospect and there was some evidence that consumer demand had strengthened a little". Yet, the central bank remained concerned about the strength of Aussie. Policymakers indicated that "the exchange rate remained high by historical standards. Despite commodity prices falling further over the past month, the exchange rate had appreciated a little further. While the decline in the exchange rate from its highs a year earlier would assist in achieving balanced growth in the economy, this would be less so than previously expected given the rise in the exchange rate over the past few months". Overall, they retained the view that the existing monetary setting is "appropriately configured to foster sustainable growth in demand and inflation outcomes consistent with the 2–3 per cent inflation target".
Looking ahead, Swiss PPI is expected to drop -0.1% mom, -0.9% yoy in March. UK CPI is expected to slowed to 1.6% yoy while core CPI is also expected to slow to 1.6% yoy in March. PPI input is expected to drop to -6.1% yoy,, PPI output to drop to 0.3% yoy, PPI output core to drop to 0.9% yoy. German ZEW economic sentiment is expected to drop slightly to 46 in April. US CPI is expected to rebound back to 1.5% yoy in March while core CPI is expected to be unchanged at 1.6% yoy. US will also release Empire state manufacturing, TIC capital flow and NAHB housing market index.