The dollar is relinquishing yesterday's gains, and the pattern has been repeated relentlessly since January 16: the $-Index is down -0.35% to 103.25, the same level as on August 31 or December 1.

This proves that the greenback is resisting radical changes in interest rate expectations for the end of 2024, with the market first validating 3, then 6, then even 8 rate cuts between the end of August and the beginning of December (5 25-Point differentials, which is considerable and gave Wall Street a boost)... which is far more than what was expected on the ECB side in the meantime.
Returning to the January 24 session, the dollar did not in any case benefit from the strength of US private sector activity (PMI) at the start of the year: according to S&P Global, growth is accelerating, with the composite PMI coming in at 52.3 in flash estimates, a seven-month high, after 50.9 in December.

Expansion was underpinned by service providers, while manufacturers continued to see their output fall as supply problems intensified", says S&P Global.

Given traders' cautious stance on the eve of the ECB meeting, it is unlikely that the figures published in Europe supported the Euro against the Dollar: indeed, the single currency was broadly stagnant against the other currencies (Pound and Yen, Australian $, etc.).

The Swiss Franc was the strongest, with +0.8% against the $ and +0.55% against the Euro... and +1.3% against the Canadian Dollar, the weakest currency (losing 0.75% against the Euro and 0.5% against the $), while Justin Trudeau could be in trouble for having used unconstitutional procedures to quell the Canadian truckers' revolt in February 2022.

As a reminder, and even this has no real impact on FOREX, the HCOB flash PMI composite index of overall activity in the eurozone stood at 47.9 in January, highlighting an 8th consecutive month of falling activity among the region's private companies.

The index has, however, recovered from December 2023 (47.6), but remains far from the expansion level (50.1).

And things aren't getting any better in France: the HCOB composite PMI index fell from 44.8 in December to 44.2 in January ('flash' estimate), posting a four-month low and underlining the sharp contraction in overall activity in the country.

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