Greenback Surges on Senate Approval of US Tax Overhaul Blueprint
Published October 20, 2017
Late yesterday, the US Senate approved a budget framework for the 2018 fiscal year which is expected to clear the way for the Republicans to pursue their much talked about tax overhaul without Democratic support. The overhaul is expected to add up to $1.5 trillion to the US federal deficit over the next 10 years to pay for proposed tax cuts, but the Senate vote seems to have ushered back in “Trumpflation” with USD seeing the biggest weekly gain in 2 weeks.
At home in Canada this morning, we saw CPI and Core Retail sales disappoint the markets by missing expectations (see below for details). This weak data, combined with the USD bullishness from the Senate tax vote has caused USD to increase ~0.81% (at the time of writing) at the expense of the Canadian dollar.
US Federal Reserve Chair Janet Yellen will be delivering a speech titled “Monetary Policy Since the Financial Crisis” this evening at 7:30PM EDT. Her comments will be closely watched and interpreted for any clues on US monetary policy.
Crude oil is down this morning on profit taking after two weeks of steady price increases. Traders will be on the lookout for increased US shale production when the Baker Hughes weekly rig count data is released later today. WTI crude is down 0.35% to $51.33 and Brent is down 0.17% to $57.13 at time of writing.