U.S. Dollar Firms As Fed Minutes Suggest QE Tapering To Begin This Year
August 18 2021 - 11:37PM
RTTF2
The U.S. dollar strengthened against its major counterparts in
the Asian session on Thursday, as the Federal Reserve's minutes
showed that most officials agreed to begin the reduction of bond
purchases later this year.
Most participants judged that it could be appropriate to start
tapering the bond purchases later this year amid progress towards
employment goal and meeting inflation criteria, the minutes from
the Fed's July 27-28 meeting showed.
But there was still some disagreement over the timing of
tapering the asset purchases.
Although some believe tapering could begin in the "coming
months," others felt a reduction in the pace of asset purchases
would be more likely to become appropriate next year.
Participants favoring waiting until next year saw prevailing
conditions in the labor market as not being close to meeting the
"substantial further progress" standard or because of uncertainty
about the degree of progress toward the price stability goal.
Most participants acknowledged that it would be important to
reaffirm the absence of any mechanical link between the timing of
tapering and that of an eventual increase in the target range for
the federal funds rate.
The greenback climbed to a 4-week high of 1.3699 against the
pound, 6-day highs of 110.23 against the yen and 0.9207 against the
franc, off its early lows of 1.3758, 109.76 and 0.9152,
respectively. The greenback is seen finding resistance around 1.34
against the pound, 112.00 against the yen and 0.94 against the
franc.
The greenback appreciated to 9-1/2-monh highs of 1.1666 against
the euro and 0.7175 against the aussie, following its early lows of
1.1717 and 0.7243, respectively. On the upside, 1.15 and 0.70 are
possibly seen as its next resistance levels against the euro and
the aussie, respectively.
The greenback recovered from its early lows of 0.6888 against
the kiwi and 1.2647 against the loonie, rising to more than a
9-month high of 0.6834 and more than a 4-week high of 1.2735,
respectively. The greenback is likely to find resistance around
0.66 against the kiwi and 1.30 against the loonie.
Looking ahead, U.S. weekly jobless claims for the week ended
August 14 and leading index for July will be published in the New
York session.
AUD vs US Dollar (FX:AUDUSD)
Forex Chart
From Mar 2024 to Apr 2024
AUD vs US Dollar (FX:AUDUSD)
Forex Chart
From Apr 2023 to Apr 2024