Asian Session – Dollar under pressure versus euro before Yellen
February 11, 2014 7:40 am
The dollar found itself under pressure against the euro and the pound in today’s trading, ahead of the testimony of new Federal Reserve Chair Janet Yellen before select committees of the US congress. The euro gained 0.11% to trade at 1.3659 against the dollar while the pound was up 0.10% at 1.6417.
Trading conditions were thin as Japanese markets were closed due to a bank holiday.
Yellen is expected to repeat the Fed’s mantra that tapering will continue as long as the US economy is growing and that interest rates will stay near zero for an extended period of time. However, investors will closely scrutinize her assessment of economic conditions, look for any clues of triggers that might cause a pause in tapering and the timeframe she sees for higher interest rates to begin.
Ahead of Yellen’s testimony and following the weaker-than-expected January nonfarm payrolls, traders appeared to sell the dollar, pushing the dollar index to a 2-week low.
The dollar did manage to post slight gains against the yen, rising by 0.05% to 102.29.
Risk sentiment was overall positive as the US stock index benchmark, the S&P 500, rose for 3 consecutive sessions during the previous day. Both the pound and the euro were higher against the Japanese yen at 167.93 and 139.7 respectively.
There were some positive data for the pound as the British Retail Consortium announced that retail sales for January posted their fastest annual growth since 2011 (+5.4%). The figures showed that the UK consumer was in good shape despite the minor wage gains workers were enjoying.
The Australian dollar rallied past the important 0.90 level against the US dollar following a strong National Australia Bank (NAB) business confidence survey for January. A stronger-than-expected house price index for the fourth quarter was also announced, suggesting perhaps that there was no need for a looser monetary policy from the Reserve Bank of Australia (RBA). According to dealers, there might have been stop losses placed by speculative shorts around the 90 cent level, which were triggered by the move.
The aussie rose by 0.67% against the US dollar to trade at 0.9006.
Gold was strong, hitting a 3-month high above 1280 dollars an ounce. Gold took advantage of the weak dollar to push higher. In addition, the China Gold Association released figures showing that Chinese consumption of gold surpassed 1,000 tonnes for the first time in 2013.
There was little in terms of major economic data until Yellen’s testimony and question and answer session at 1500 GMT.
The dollar found itself under pressure against the euro and the pound in today’s trading, ahead of the testimony of new Federal Reserve Chair Janet Yellen before select committees of the US congress. The euro gained 0.11% to trade at 1.3659 against the dollar while the pound was up 0.10% at 1.6417.
Trading conditions were thin as Japanese markets were closed due to a bank holiday.
Yellen is expected to repeat the Fed’s mantra that tapering will continue as long as the US economy is growing and that interest rates will stay near zero for an extended period of time. However, investors will closely scrutinize her assessment of economic conditions, look for any clues of triggers that might cause a pause in tapering and the timeframe she sees for higher interest rates to begin.
Ahead of Yellen’s testimony and following the weaker-than-expected January nonfarm payrolls, traders appeared to sell the dollar, pushing the dollar index to a 2-week low.
The dollar did manage to post slight gains against the yen, rising by 0.05% to 102.29.
Risk sentiment was overall positive as the US stock index benchmark, the S&P 500, rose for 3 consecutive sessions during the previous day. Both the pound and the euro were higher against the Japanese yen at 167.93 and 139.7 respectively.
There were some positive data for the pound as the British Retail Consortium announced that retail sales for January posted their fastest annual growth since 2011 (+5.4%). The figures showed that the UK consumer was in good shape despite the minor wage gains workers were enjoying.
The Australian dollar rallied past the important 0.90 level against the US dollar following a strong National Australia Bank (NAB) business confidence survey for January. A stronger-than-expected house price index for the fourth quarter was also announced, suggesting perhaps that there was no need for a looser monetary policy from the Reserve Bank of Australia (RBA). According to dealers, there might have been stop losses placed by speculative shorts around the 90 cent level, which were triggered by the move.
The aussie rose by 0.67% against the US dollar to trade at 0.9006.
Gold was strong, hitting a 3-month high above 1280 dollars an ounce. Gold took advantage of the weak dollar to push higher. In addition, the China Gold Association released figures showing that Chinese consumption of gold surpassed 1,000 tonnes for the first time in 2013.
There was little in terms of major economic data until Yellen’s testimony and question and answer session at 1500 GMT.
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