Dollar holding on to week's gains - BBH

Global currency strategy team at BBH noted that the US Dollar held on to its weekly gains as markets look forward to the key Trump-Abe meeting, later during the day.

Key Quotes:

“The US dollar is less than 12 hours away from gaining against all the major currencies this week. The main talking points today remain Trump-centric.”

“Ahead of the meeting with Abe, Trump indicated that currency manipulation, which he has accused several countries, including Japan, is not at the top of the agenda. This may have encouraged further yen weakness today.”

“Meanwhile, Trump yesterday indicated that a "phenomenal" tax-related announcement would be made in the next several weeks.  During the campaign, he talked about a 15% corporate tax rate while the GOP plan was for 20%. The Government Accounting Office says US large corporations paid an average 14% rate in 2008-2012.  Other studies say that overall US business pay 21.1% vs. the 21.7% OECD average.”

“The US dollar is mixed as North American trading gets underway.  Of note, the dollar is continuing to gain on the yen. USD/JPY appears to have put in a good base around the 111.60-65 area this past week.  The yen is off 0.4%, which is nearly half the week's decline.  The Aussie is the strongest on the day, up about 0.2% to trim the week's loss to about 0.45%.  Sterling is the strongest of the majors this week and it is off about 0.1%.”

“During the North American session, the US reports January import prices and preliminary February Michigan confidence.  There are no Fed speakers today, though Vice Chair Fischer speaks at a UK economic conference tomorrow.  Canada reports January jobs, with consensus currently at -10k.”