The U.S Dollar index edged higher versus a basket of major currencies on Wednesday supported by data regarding consumer confidence and manufacturing growth, while investors are waiting for the outcome of the Federal Reserve two day meeting later today. The U.S dollar index edged higher against a basket of six major rivals to 94.57.
Regarding the U.S central bank meeting, today expectation shows that the federal reserve is likely to keep interest rates at its current levels. However, investors will be looking for any indicators regarding interest rates rise next month.
Furthermore, investors outlook for the economy in the U.S remained positive as the Consumer Confidence came at 125.9 beating forecasts of 121 and higher than the previous reading which came at 120.6 in September. Consumer sentiment is considered a leading indicator of consumer spending, which has a significant effect on the overall economic activity.
Moreover, The Chicago Purchasing Managers' Index also came higher than expected at 66.2 above forecasts of 61 , the index is leading indicator for the U.S economy that helps economist to determine the business activities.
Regarding the nomination of the federal reserve, the U.S president Trump is expected to announce the successor of Janet Yellen this Thursday, reports shows that President Trump is leaning towards Jerome Powell to be the next head of the U.S central bank.
Regarding the tax reduction news, republicans lawmakers could introduce a bill regarding cutting taxes while the treasury department is going to release refunding plans, expectations showes that the government is likely going to increase the size of its regular auction to face the fed reduction of its balance sheet.
Over in Europe, the common currency fell against the U.S dollar in today’s session after the europian inflation data came below expectations, the consumer price index came lower than forecasts by 0.1 percent to register 1.4 percent increase in the prices of goods and services. On the other hand, the year on year primary release of the Gross Domestic Product for the third quarter came above expectations at 2.5 percent the EUR/USD ended the sessiuon at 1.1645.
Meanwhile, The Cable rose versus the dollar as expectations show that the bank of England is likely to increase interest rates for the first time in a decade. The GBP/USD traded higher on Tuesday to settle at 1.3288.
Looking at safe-haven currencies, the Japanese yen fell against its dollar counterpart amid positive data from the U.S. The USD/JPY rose to trade at 113.62 at the close.Moreover, the USD/CHF rose to trade at 0.9975 at the close.
Regarding bank of Japan meeting yesterday, the Bank has kept its short-term interest rates at minus 0.1 percent.
In the precious metals front, Safe-haven asset gold fell against the greenback on Tuesday to trade at 1270.85 at the close. After U.S dollar rose amid positive economic data.
Elsewhere in Canada, the loonie fell versus the greenback after the GDP came at minus 0.1 percent. The USD/CAD rose to settle higher at 1.2888.
Meanwhile, in Australia, the AIG Manufacturing index for October came at 51.1 below the previous reading of 54.2 The AUD/USD traded at 0.7656 at the close.
© Copyright 2017
The information contained in this publication is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Any opinion offered herein reflects Gotinsiders.com current judgment and may change without notice. Users acknowledge and agree to the fact that, by its very nature, any investment in shares, stock options and similar and assimilated products is characterized by a certain degree of uncertainty and that, consequently, any investment of this nature involves risks for which the user is solely responsible and liable.