The USD struggled all week to string gains against majors on the back of mixed economic data. The U.S. trade balance showed a higher tan forecasted deficit (-47.1 billion) and a decrease of job openings (5.45 million) put downward pressure on the USD, but the non-manufacturing PMI rose higher than anticipated to 54.5. The release of the Federal Open Market Committee (FOMC) meeting minutes shed more light on the conversations that shaped the dovish statement and logically put downward pressure on the greenback.
Thursday risk-off trading punished emerging markets and equities boosting the dollar despite previous trends. Global risk aversion pushed the Japanese yen higher versus the USD as investors sought safety. The Canadian dollar was able to offset some losses with a monster jobs report that saw the economy add 40,600 jobs; four times the estimate.
The US rally will have to pass the test of monthly retail sales to be announced on Wednesday, April 13 at 8:30 am EDT. American retail sales have remained flat despite a recovery in employment as consumers are saving more. The U.S. economy depends on consumer demand for 70 percent of economic activity and while the U.S. non farm payrolls (NFP) exceeding expectations will not change the Fed’s mind about an interest hike in April, its another sign that consumer sentiment will continue to improve.