Dollar sentiment improves as Senate approves 2018 budget

Both economic data and corporate reports were positive during the week. The Chicago Fed national activity index came in at 0.17 in September, up from a downwardly revised negative 0.37 in August. The Markit Manufacturing composite purchasing managers’ index, a gauge of economic activity, rose to 54.5 in October, a nine-month high. Senate’s approval of a $4 trillion budget blueprint for the 2018 brought Republicans one step closer to pursuing a tax-cut overhaul without Democratic support. President Trump said he was “very, very close” to making his pick to head the Federal Reserve when Chairwoman Janet Yellen’s term ends in February. He had told he was thinking about naming Jerome Powell and John Taylor together. As is evident from the Sentiment table, sentiment deteriorated for all major currencies against the dollar. And the euro, Canadian and Australian dollars remained the three major currencies held net long against the US dollar after British Pound net long bets of $0.42 billion turned into net shorts of $0.12 billion.