The US dollar started the week with gains as the risk-negative market sentiment drove market participants to safer currencies. The same pessimistic mood boosted the Japanese yen as well, allowing it to gain even more than the US currency.
The major theme of the day was the disappointing manufacturing data out of China. Another one was the growing tension between Iran and Saudi Arabia that threatens to spread to the whole Middle Eastern region.
As a result, the dollar was relatively strong, ignoring underwhelming domestic data. The greenback was not as firm as the yen, but gained against other majors, like the euro and the sterling.
Meanwhile, market analysts continue to speculate what effect the Federal Reserve interest rate hike should have on the US currency and why it was not as supportive as it could have been.
EUR/USD traded at about 1.0826 as of 2:15 GMT today after falling from 1.0872 to 1.0829 yesterday. GBP/USD was near 1.4717 following the drop from 1.4732 to 1.4710 during the previous trading session. USD/JPY declined from 120.19 to 119.42 before trading at 119.57 during the Tuesday’s session.
If you have any questions, comments or opinions regarding the US Dollar,
feel free to post them using the commentary form below.