The U.S. dollar traded near longer than two-week troughs versus major peers on Thursday, which was tracking treasure income lower. No new catalysts were offered to dictate market direction after minutes of the Federal Reserve’s March policy meeting as well.
Fed officials remained wary about the coronavirus pandemics’ risks and committed to strengthening monetary policy support until a more secure rebound.
The dollar index measures the greenback against a basket of six currencies—it bounded lower to 92.371 in the Asian session. For the first time since March 23, the dollar fell as low as 92.134 on Wednesday.
U.S.’s faster pandemic recovery helps to strengthen the dollar
At the end of last month, the scale returned to an almost five months high of 93.439. It is primarily due to the U.S.’s faster pandemic recovery than the most developed countries in Europe. The U.S. macro outperformance trade is tiring out. Powerful vaccine rollouts, reopening businesses robust rebound data in next several months. According to the Westpac strategists report, the rate forecast is 94.5.
The 10-year treasure income benchmark was around 1.67% on Thursday. However, it falls at 1.63% overnight. It hit a more than the one-year top of 1.776% late last month. Citigroup Global Markets Japan’s chief currency strategist Osamu Takashima said that the market’s direction is challenging to call. Still, it is likely the next move for the greenback to be lower.
The recession in U.S. yields has also thwarted a dollar’s gains. The dollar slightly fell to yen (109.66) after a more than a year high of 110.97. The euro has been lower at $1.1704 for five months.
However, not it is almost unchanged from Wednesday and stays at $1.18715. The vaccination progress in the Eurozone is significantly delaying. Compared to the U.S., Coronavirus infection rates in Eurozone are on the rise again. As such, EUR/USD is vulnerable to a move below 1.1700 in the near term.
COMMENTS