U.S. Dollar Advances On Risk Aversion
April 25 2019 - 3:50AM
RTTF2
The U.S. dollar strengthened against its most major counterparts
in the European session on Thursday, as European shares fell,
tracking weakness in Asia, following disappointing economic data
from Germany and South Korea that rekindled global slowdown
fears.
Investors became cautious as a drop in German business
confidence in April and contraction in the South Korean economy in
the first quarter renewed fears over slowing global growth.
In its economic bulletin, the European Central Bank warned of
slowing global growth and downside risks stemming from trade
tensions.
Traders await U.S. durable goods orders and jobless claims, due
to be released at 8:30 am ET.
The U.S. first-quarter gross domestic product data is due on
Friday. Economists expect the economy to have expanded an
annualised 2.2 percent in the first three months of 2019, unchanged
from the previous quarter.
The greenback held steady against its major counterparts in the
Asian session, with the exception of the yen.
The greenback advanced to a 2-day high of 1.0225 against the
franc, from a low of 1.0196 touched at 5:00 pm ET. The greenback is
seen finding resistance around the 1.05 level.
The greenback spiked up to 1.1128 against the euro, a level
unseen since June 2017. Next key resistance for the greenback is
seen around the 1.10 level. The greenback that closed Wednesday's
trading at 1.2902 against the pound strengthened to more than a
2-month high of 1.2871. On the upside, 1.27 is possibly seen as the
next resistance level for the greenback.
The greenback appreciated to 0.6992 against the aussie, its
highest since January 3, when it set a 10-year peak. Should the
greenback continues its rise, 0.68 is possibly seen as its next
resistance level.
The U.S. currency firmed to near a 6-month high of 0.6580
against the kiwi, compared to 0.6592 hit late New York Wednesday.
The greenback is poised to test resistance around the 0.64
area.
The greenback edged up to 1.3517 against the loonie from
Wednesday's closing value of 1.3489. Extension of the greenback's
uptrend is likely to take it to a resistance around the 1.37
level.
On the flip side, the greenback held steady against the yen,
after having dropped to 111.74 at 3:15 am ET. At yesterday's close,
the pair was worth 112.17.
The Bank of Japan kept its monetary policy unchanged, leaving
the interest rate at -0.1 percent and the yield of 10-year JGBs at
around zero percent.
The BoJ said that it will keep its current extremely low
interest rates for an extended period of time, at least through
spring 2020.
Looking ahead, U.S. weekly jobless claims for the week ended
April 20 and durable goods orders for March are scheduled for
release in the New York session.
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