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Atlanta Federal Reserve President Raphael Bostic said on Wednesday that the rift between the Federal Reserve and the White House has begun to erode public trust in the central banks apolitical position. This is one of the most direct warnings yet from a senior monetary policy official about the consequences of Trumps hawkish stance on the Fed. In his farewell address before retiring from the Atlanta Fed at the end of February, Bostic said his colleagues within the Fed system remain committed to keeping their work separate from politics. "But my visits over the past few months have made it clear that the legal and verbal battles surrounding the central bank have led people from all walks of life to question the Feds independence, which is a serious concern." Bostic is not the only Fed official this year to emphasize the importance of central bank independence, but no one has warned as directly as he did on Wednesday that the current controversies could undermine public trust in the institution.The vote count showed that the French government survived its first vote of no confidence in parliament.February 26 - According to the Cuban Embassy in the United States, the Cuban Ministry of the Interior issued a statement saying that when a border patrol vessel approached a U.S. speedboat for identification checks, the crew of the speedboat opened fire on the Cuban personnel, injuring the Cuban patrol vessels commander. As of the time of this announcement, four attackers on the foreign vessel have died and six others have been injured.Federal Reserves Bostic: A broad group has begun to question the Feds independence. The Feds independence in setting monetary policy has improved economic outcomes and market confidence, helping to maintain the U.S.s status as a safe haven.KLM Royal Dutch Airlines: Flights between Amsterdam and Tel Aviv will be temporarily suspended starting March 1.

USD/CAD declines to 1.3500 on firmer Oil prices, BoC concerns over US inflation, and Fed Minutes

Daniel Rogers

Apr 10, 2023 14:35

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The USD/CAD maintains losses close to 1.3500, shattering a four-day winning trend, as traders brace for key Easter Monday data/events on major bourses. However, the recent decline in the Loonie-U.S. dollar exchange rate may be due to the increase in the price of WTI petroleum oil, Canada's primary export. In contrast to the recent increase in ardent Fed forecasts, the Bank of Canada's (BoC) dovish bias poses a challenge to pair sellers.

 

After increasing for three consecutive weeks, WTI crude oil prices gain 0.61 percent intraday near $80.00. Recent increases in the price of black gold may be due to geopolitical concerns surrounding China and Taiwan. In addition to the supply cut by OPEC+ and the faltering US dollar, the energy benchmark is sustained by the supply cut by OPEC+ and the weakening US dollar.

 

However, the US Dollar Index (DXY) has fallen for three consecutive weeks and is under pressure near 102,000.

 

Fears of higher Fed rates versus inaction from the Bank of Canada (BoC) grew after the upbeat US Jobs report versus the lack of significant positives in the March Canadian jobs report.

 

As a result, the CME's FedWatch Tool indicates a 69% chance of a 0.25 basis point rate hike in May, up from 55% prior to the US employment report.

 

Canada's headline Net Change in Employment increased to 34.7K in March from 21.8K in February, compared to the market consensus of 12K, while the Unemployment Rate came in at 5% versus the analysts' estimate of 5.0%. During the specified month, the Participation Rate decreased to 65.6% from the expected and previous rate of 65.7%. In addition, the average hourly wage fell 5.2% year-over-year in March, down from 5.5% in February.

 

In contrast, the US Bureau of Labor Statistics (BLS) reported that Nonfarm Payrolls (NFP) increased by 236K in March, the lowest increase since January 2021 (considering revisions), compared to the expected 240K and the previous 330,000. Additionally, the unemployment rate fell from 3.6% to 3.5%, while the labor force participation rate rose from 62.6% to 62.6%. The annual wage inflation rate decreased from 4.6% to 4.2%, below market expectations of 4.3%.

 

Futures on US equities ended higher, but yields remain under pressure ahead of the crucial BoC monetary policy meeting, US inflation, and Fed Minutes. Given the dovish concerns from the Bank of Canada (BoC) and the likely hawkish comments in the FOMC Minutes, the USD/CAD may see additional gains, barring any unexpected developments.


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