The dollar weakened against its peers to its lowest level in 2 weeks as chances of another rate increase by the Federal Reserve are looking to be less likely and as discouraging trade data released out of China tarnished market sentiment.  Federal Reserve Governor Lael Brainard stated that lagging Chinese economic growth and reduced global demand still remain as threats to the US economy even though global financial markets have stabilized recently, comments which lowered predictions for a Fed rate hike.  The US dollar index was down 0.15% trading at 96.97 marking a 2 week low.
 
The euro strengthened against the dollar with the pair up 0.2% trading at 1.1002 off its session low of 1.0993 after having come off its session high of 1.1057 reached earlier in the day.  The euro was still faced with pressure to the downside as expectations for additional stimulus measures by the European Central Bank grew in anticipation of the central bank’s latest policy meeting on Thursday.  Some speculate that the ECB’s plans to loosen monetary policy will fall short of weakening the euro.     
 
The pound weakened against the dollar with the pair down 0.5% trading at 1.4210 off its session low of 1.4172 after having come off its session high of 1.4275 reached earlier in the day.  Bank of England Governor Mark Carney reconfirmed that the central bank would not make an endorsement on the upcoming referendum to decide whether the UK will remain a member of the European Union.  Uncertainty over Britain’s future has pushed the pound to new 7 year lows.  Based on interest rates alone there isn’t much support for the pound which is struggling with monetary policy expectations and that the BOE rarely live up to promises of interest rate hikes.   
 
The yen strengthened against the dollar with the pair down 0.7% trading at 112.70 off its session low of 112.42 after having come off its session high of 113.51 reached earlier in the day.  The yen was supported by an increase in safe haven demand following the release of data which revealed that China’s exports plummeted 25.4% from the previous year to total $126.1 billion in February, compounding forecasts for a drop of 12.5%.  On a year over year basis China’s imports declined 13.8% in February following a decline of 18.8% in January.  Sharp declines in exports was partly a result of the Chinese New Year holiday celebrated early February however the data still revealed lagging global demand.  Japan’s GDP decreased 1.1% in the 4th quarter of 2015 while experts forecast a decrease of 1.4%.
 
The Australian, New Zealand and Canadian dollars weakened against the greenback as crude oil retreated from 2 month highs amid bearish comments from Kuwait and Goldman Sachs.  The Aussie was down 0.3% against the dollar with the pair trading at 0.7455 off its session high of 0.7472 after having come off its session low of 0.7410 reached earlier in the day.  The kiwi dollar dropped 0.71% against the greenback with the pair trading at 0.6754 off its session high of 0.6802 after having come off its session low of 0.6739 reached earlier in the day.  The National Australia Bank released data which revealed that its business confidence index was unchanged at a reading of 3 for February following a reading of 3 in January.  The loonie retreated 0.9% against the greenback with the pair trading at 1.3405 off its session high of 1.3411 after having come off its session low of 1.3279 reached earlier in the day.  Crude traded between $36.47 and $38.38 per barrel before closing down 3.64% at $36.52.  Higher oil prices had supported commodity associated currencies earlier in the session.  Kuwait appears reluctant to reach a deal with the world’s major producers to halt output unless all 13 of OPEC’s members work together.  Canada’s building permits dropped by 9.8% in January compounding forecasts for a decrease of 2.5% following an increase of 7.7% in December.  Canada’s housing starts climbed from 165,100 units in January to 212,600 units in February.    
 
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