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Dollar Forex Market Holds Strong on Recovery Concerns

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  • USD Remains Firm With Tapering Still Expected
  • Euro Steady Ahead of Key Meeting
  • Futures Lower on Tough Week for Wall Street

The USD forex market continued to stay strong in early trading today. This comes as concern starts to increase over the speed of the economic recovery. President Biden is due to present a further strategy today to deal with the still problematic Delta variant of COVID-19. Tapering too is still on the agenda with many Fed chiefs around the country sticking with a hawkish viewpoint. The Euro has not been pushed back by this climate, however. In fact, it has advanced slightly with the important ECB policy meeting taking place. Trading on Wall Street remains cautious with major markets including the Dow Jones poised to open lower again today.

Tapering Still on Agenda of Many

Those forex trading in the USD have enjoyed an Indian summer of sorts. The Dollar has stayed strong in the last few days after a period of weakness after the Fed Policy continuation coming out of the Jackson Hole Symposium. This week though has seen a move back toward strength with uncertainty prevailing in many areas this week.

This comes as COVID cases continue to be an issue across the country, and one which President Biden is set to address today with a multi-faceted policy. Tapering too remains on the table and is very much a topic of conversation with many Fed Chiefs feeling the monetary policy approach from Jerome Powell has been too soft. This USD strength has best been reflected in the price of gold which has struggled close to two-year lows. 

Euro Not Deterred by Sentiment

Despite the Dollar strength, the EUR/USD has held up well. It has even moved clear of 1.18 in the last day as the Euro consolidates its own recent recovery. Even though the recent news of an inflation spike in the bloc, with the number up to 3%, may have caused unease among policymakers, it has not been reflected with forex broker orders. 

The major focus for the Euro today will be on a key meeting of these policymakers. The governors are meeting to discuss the roadmap and next steps for ECB policy, with a tightening widely rumored given the hot inflation data. This is not expected to result in an increase in the interest rate in the region though. This fact alone may be helping to bolster the currency.

Challenging Week on Wall Street Continues

With a sense of unpredictability prevailing across most of the market sectors, the knock-on impact has been felt on Wall Street. This has led to losses with the Dow Jones down for a third straight day yesterday, and futures trading lower still.  

US jobless claims just in may provide a boost though. They have arrived under the expected 335,000 at 310,000 for the previous week. Eyes will be on this to see how traders react to the news.

The Blogger Scientist is a "Medical Physiologist" and a "Financial Asset" Content Creator who aims at enlightening web reader on varying Financial Assets such as Stocks, FX, Crypto, MLM,. HYIP among others.

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