U.S. Dollar Weakens Ahead Of Key Risk Events
June 05 2017 - 11:19PM
RTTF2
The U.S. dollar slipped against its major rivals in the Asian
session on Tuesday, with investors adopting a cautious stance ahead
of U.K. general elections, the European Central Bank meeting and a
testimony by former FBI Director James Comey in the United States -
all scheduled for Thursday.
Comey is set to testify before the Senate Intelligence Committee
on Russia investigation. He is likely to be grilled by the
Committee about the conversations with the U.S. President Donald
Trump related to the ongoing investigation into Russian
interference in the 2016 election.
Investors also keep an eye on the Federal Reserve's FOMC meeting
next week, with most economists expecting a 25 bps rate hike.
U.S. factory orders fell for the first time in five months in
April, whereas services sector activity slowed in May, separate
reports showed on Monday. Recent downbeat data suggested that the
Fed is likely to adopt a more cautious stance for rate hikes beyond
June.
According to the latest Survation poll conducted on Friday and
Saturday, British Prime Minister Theresa May's lead over the
opposition Labour Party has shrunk from 17 to just 1 percentage
point.
The ECB is widely forecast to keep monetary policy unchanged,
although investors expect it to tweak its guidance to keep up with
the eurozone's broad-based and resilient economic recovery.
The greenback showed mixed performance on Monday. While the
currency rose against the franc and the euro, it held steady
against the Japanese yen. Against the pound, the greenback
weakened.
The greenback slipped to 109.60 against the Japanese yen, its
lowest since April 25. Continuation of the greenback's downtrend
may see it challenging support around the 108.00 region.
The greenback remained lower against the Swiss franc with the
pair trading at 0.9635. At Monday's close, the pair was valued at
0.9653. On the downside, the greenback is likely to locate 0.95 as
the next support level.
The greenback that closed Monday's trading at 1.1254 against the
euro dropped to 1.1278. The greenback is poised to locate support
around the 1.14 mark.
The greenback slipped to near a 2-week low of 1.2950 against the
pound, compared to 1.2901 hit late New York Monday. The greenback
is seen challenging support around the 1.32 level.
The Report on Jobs compiled by the Recruitment and Employment
Confederation and IHS Markit showed that U.K. permanent job
placements grew at the fastest pace in just over two years in
April.
The number of people placed in permanent jobs increased notably
in May and the rate of expansion was the fastest for 25 months.
The greenback dropped to a 6-day low of 1.3443 against the
loonie, while reaching over a 3-month low of 0.7175 against the
kiwi. Further weakness may take the greenback to support levels of
around 1.32 against the loonie and 0.73 against the kiwi.
Looking ahead, Eurozone Sentix investor sentiment index for June
and retail sales for April are due in the European session.
At 10:00 am ET, Canada Ivey PMI for May is set for release.
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