Dollar Trades Near One-Year High Versus Euro on Fed - GBP/USD takes a breather after fresh 6-month lows - EUR/USD took a respite after a long trip to yearly lows The dollar traded near the strongest in almost a year against the euro on bets quickening U.S. growth will spur the Federal Reserve to increase interest rates sooner than traders anticipate. The U.S. currency held gains from yesterday most of its 16 major counterparts before reports this week that economists said will show factory orders increased and employers boosted hiring. The U.S. currency traded at $1.3138 per euro at 7:27 a.m. in London from $1.3133 yesterday, when it climbed to $1.3110, the strongest since September 2013. The dollar was little changed at 104.93 yen after appreciating to 105.31, the highest since Jan. 10. The yen added 0.1 percent to 137.85 per euro. U.S. factory orders surged 11 percent in July, after rising 1.1 percent the previous month, according to a Bloomberg survey before today’s Commerce Department report. A Labor Department report on Sept. 5 will show payrolls rose by more than 200,000 in August for a seventh month, a separate survey showed. There’s a 44 percent chance Fed policy makers will increase the benchmark interest-rate target by June 2015, compared with a 36 percent likelihood on Aug. 18, according to futures data compiled by Bloomberg. U.S. policy makers have kept their key rate near zero since December 2008 to spur growth. The GBP/USD is staging a minor bounce after yesterday sell off took it to its lowest in 6 months amid fears of a yes vote in Scotland. The GBP/USD had it worst performing since January on Tuesday, falling nearly 150 pips throughout the day weighed by news that the Scottish polling gap is narrowing into the referendum on Sep 18. The Cable extended losses during the Asian session and bottomed out at 1.6444, posting its lowest level since February 12 before bouncing. The pair has managed to recover to the 1.6480 zone but the correction is timid compared to the steep fall. EUR/USD opened the day at 1.3131, lost ten pips during the Asian morning, and rebounded above 1.3141 session high at European morning. The pair is showing some attempts to recover from yearly lows, and the looming reports from the euro zone may help with volatility. Although the market is waiting for the ECB meeting impatiently, the released today PMI data still may have some impact on the pair. German data is of special interest as the health of the largest European economy is very important for the whole euro zone economy. Another evidence of weakness may put the pair under pressure sending it to the nearest support levels. Have a good day!
Posted on: Wed, 03 Sep 2014 08:24:16 +0000
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