US dollar is lower today after yesterday’s solid gains, and as lack of panic in Cyprus gives risk appetite a bit of a boost. There could still be strength for the US dollar coming later this year, though. For now, though, the US dollar index is lower.
Banks in Cyprus opened today, following a hiatus that lasted almost two weeks. The bank openings are accompanied by rules limiting cash withdrawals, however. Concerns that Cypriots would precipitate a run on the banks led to tighter controls prior to opening.
The controls, as well as the continued evidence that the ECB is willing to do almost anything to keep the euro intact, are helping keep the US dollar a little lower. Some profit taking on the dollar’s surge yesterday is also probably a factor. Better US economic data, pointing to continued (if somewhat weak) recovery, is also providing some reason for risk appetite.
With risk appetite making its cautious reappearance, and the euro consolidating, US dollar index is lower today. However, continued problems in the eurozone could lead to more dollar strength later in the year.
At 14:22 GMT the dollar index is down to 82.956 from the open at 83.202. EUR/USD is up to 1.2835 from the open at 1.2777. GBP/USD is up to 1.5166 from the open at 1.5128.
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