US Dollar saw interest in the European session after a subdued Asian session on Friday.
The US Dollar saw interest in the European session after a subdued Asian session on Friday. The US Dollar Index (DXY). Which measures the value of the US dollar against a basket of six major currencies. Continued its weekly uptrend and surpassed 101.00 for the first time in more than a week.
Early Friday, the US Dollar grabbed capital inflows from the Japanese Yen. Assisting the DXY in gaining traction. Reuters reported on Friday, citing five persons familiar with the situation. That the Bank of Japan was leaning toward keeping current yield curve. control (YCC) plan at the policy conference next week. Dovish BoJ predictions spurred a JPY selloff, boosting the USD.
The US economic calendar will be devoid of any high-impact data releases that might influence the USD’s performance. Against its competitors ahead of the weekend. Investors may also hold off on establishing significant holdings. Ahead of the highly anticipated Federal Reserve policy meeting next week.
The US dollar is expected to achieve substantial weekly gains.
The number of first-time applications for unemployment benefits in the United States fell to 228,000 in the week ending July 15, according to data released by the US Department of Labor on Thursday. This estimate came in far lower than the market’s forecast of 242,000, lifting the US Dollar Index. Other information Existing Home Sales fell 3.3% in June, following a 0.2% increase in May.
Stock index futures in the United States are slightly higher on the day. The Nasdaq Composite fell more than 2% on Thursday, while the Dow Jones Industrial Average finished higher.
The Wall Street Journal reported early Thursday that the US had prohibited 14 Iraqi banks from using the USD in transactions due to suspicions that these banks were funneling USDs to Iran.
China’s ambassador to Washington, Xie Feng, stated late Wednesday that if the US imposes more restrictions on the country’s semiconductor sector, China will retaliate.
The Manufacturing Index of the Federal Reserve Bank of Philadelphia increased marginally in July, to -13.5 from -13.7 in June.
GDP Now is a service provided by the Federal Reserve Bank of Atlanta. The model predicts 2.4% growth in US GDP in the second quarter.
According to monthly statistics released by the US Census Bureau on Wednesday, housing starts fell 8% on a monthly basis in June, following a 15.7% increase (revised from +21.7%) in May. Building permits declined 3.7% for the same time period, following a 5.6% gain in May.
According to the US Census Bureau, retail sales in the United States increased 0.2% in June to $689.5 billion. The 0.3% gain in May was expected to rise to 0.5% in June, but the statistics fell well short. Retail Sales Ex-Autos grew 0.2% in the same period, somewhat less than the 0.3% expected by the market.
For the second consecutive month, industrial production in the United States fell 0.5%. The US Federal Reserve said Tuesday that the economy grew for the third month in a row in June.
US Treasury Secretary Janet Yellen told Bloomberg on Monday that the Biden administration is likely to impose outbound investment limits on China.
The US Dollar fell sharply last week as lackluster inflation data raised hopes that the Federal Reserve will achieve the terminal rate with a 25-basis-point (bps) rate rise in July.
The Consumer Price Index (CPI) in the United States increased 3% year on year in June, following a 4% increase in May. In the same time period, the yearly Producer Price Index (PPI) increased by 0.1%.
Technical Outlook
On the daily chart, the Relative Strength Index (RSI) indicator went over 40 early Friday. Indicating that the US Dollar Index (DXY) has further potential to rise before turning neutral.
101.00 (old support, static level) corresponds to a critical pivot point for DXY. A weekly close above that level might pave the way for a longer-term rebound toward 101.50 (static level), 101.80 (20-day SMA), and 102.00 (psychological threshold).
On the negative side, Before 100.00 (psychological level), 100.50 (static level) provides temporary assistance. If the DXY index closes below the latter on a daily basis, 99.20 (the March 2022 static level) might be considered as the next support level.
