The U.S. dollar strengthened broadly on Wednesday, with the currency hitting nearly four-week highs against the yen, on anticipation that a promised White House announcement on tax reform could boost the greenback.
Overnight, Trump’s economic team unveiled a plan that included a cut to the corporate tax rate from 35 per cent to 15 per cent and an incentive for multinational groups to repatriate trillions of dollars held overseas. This was viewed by markets as disappointing and unlikely to go forward in Congress, causing the dollar to retreat.
Emmanuel Macron was booed and whistled at by striking factory workers in his hometown of Amiens, northern France, after an ambush by his nationalist rival Marine Le Pen forced him into a confrontation with some of her hardcore supporters.
Le Pen made a surprise visit to the Whirlpool Corp. plant on the edge of Amiens while election front-runner Macron was meeting with union leaders from the plant in the center of town. Le Pen told reporters on the picket line that Macron’s decision to meet the workers’ representatives behind closed doors showed his “contempt” for their plight, forcing her rival to change his plans and engage with the demonstrators live on television.
For Le Pen, it’s the perfect example of how European elitists like Macron are selling out French workers with their commitments to free trade. Macron argues that her plans to put up barriers to trade and withdraw from the euro would cost France jobs, and that the government has to work to help companies compete.
Sterling dipped versus the dollar and euro on Wednesday, struggling for direction ahead of first quarter growth numbers due on Friday in a week so far dominated by events in the euro zone.
The pound sank to a two-week low versus the euro on Tuesday, as the single currency bounced for a second day following market-favoured centrist Emmanuel Macron's victory in the first round of French presidential elections.
Besides the gross domestic product numbers due on Friday, investors are on the lookout for fresh news surrounding Britain's exit from the European Union. The process largely seems to have been put on hold by the election, although May will meet with European Commission President Jean-Claude Juncker and the EU's top Brexit negotiator, Michel Barnier, in London on Wednesday.
12.45 – EUR : Minimum Bid Rate; Forecast to stay the same at 0.0%
13.30 – EUR : ECB Press Conference
13.30 – USD : Unemployment Claims; Forecast at 241k against a previous of 244k