The USD was seeing a positive performance today against most major currencies with European currencies recording some weakness and traders monitoring economic data and hints on monetary policy.
The US currency has been rising for more than a month and is approaching its previous peak where it could find some resistance with economic conditions and expectations changing rapidly.
The Euro and the British pound have been under pressure today with PMI figures indicating deteriorating economic conditions in the Euro area as well as in the UK. The data showed stronger-than-expected declines overall in the region which could affect monetary policy expectations and could continue to weigh on the respective currencies.
In this regard, US PMI data could create some volatility for the US dollar as traders continue to monitor the economy’s strength and its impact on monetary policy.
Afterward, traders could remain cautious ahead of the release of initial jobless claims tomorrow and of the Federal Reserve’s president’s speech on Friday. The latter could significantly affect monetary policy expectations and could strongly impact the dollar’s performance.
However, the US dollar could continue to see some uncertainty against the Chinese yuan and the Japanese yen. Both currencies could see some support as traders continue to consider the potential for interventions from the respective central banks. Both rebounded after reaching new lows this year.
Leave a Comment