Dollar Rose but Remained Below a Two-Month High on Tuesday

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Dollar Rose but Remained Below a Two-Month High on Tuesday

The U.S. dollar was up but remained below its best result in two months on Tuesday morning in Asia. Investors are waiting for the U.S. employment data that could determine when the Federal Reserve will withdraw its stimulus measures.

The dollar index which tracks the world’s reserve currency against a basket of other currencies advanced 0.08% to 91.948 12:54 AM ET.

The USD/JPY pair fell 0.5% to 110.56. Another pair AUD/USD dropped 0.19% to 0.7553. The NZD/USD pair added 0.08% 0.7029.

The USD/CNY pair gained 0.08% to 6.4604 while the GBP/USD pair declined  0.12% to 1.3866.

Nonetheless, the dollar continued its decline from the high of 92.408 seen on June 18. That week the Federal Reserve surprised investors with the unexpected hawkish tone in its policy decision. Fed officials have since focused on whether upcoming data will merit asset tapering as well as interest rate hikes. Fed Chairman Jerome Powell said during the previous week that the decision wouldn’t be based on just the fear of inflation. The decision will also encourage a broad and inclusive job market recovery.

Dollar and U.S. job report

Investors are waiting for the U.S. jobs report, including non-farm payrolls for June due on Friday. The U.S. will release the information about its Conference Board Consumer Confidence Index later in the day. The Institute of Supply Management will release its Manufacturing Purchasing Managers Index on Thursday.

The safe-haven dollar and yen benefited from increasing demand as the Delta variant of coronavirus continue to spread in Asia and other parts of the world. In Europe, the euro was at $1.19210, in a move back to the two-and-a-half-month low of $1.8450, euro reached on June 18.

The risk-sensitive Australian dollar was mostly unchanged, after declining 0.3% at the beginning of the week. Four states and territories introduced lockdowns as the country battles to control a rapidly spreading coronavirus outbreak. Queensland is the latest state to announce a lockdown, after recording two new cases of community transmission on June 29.

New South Wales is currently the epicenter of Australia’s latest outbreak. The number of cases linked to Sydney’s Bondi cluster reached 143 on Tuesday.

Across the Tasmanian Sea, the kiwi also steadied as Reserve Bank of New Zealand’s Governor Adrian Orr delivered a speech.

 

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