U.S. Dollar Climbs On Trade Optimism
The U.S. dollar strengthened against its major counterparts in
the European session on Monday, as investors awaited the signing of
the Phase 1 trade deal between the U.S. and China due this
The deal due to be signed at the White House on Wednesday is
likely to include a commitment from China to increase agricultural
products and implement economic reforms as well as some relief to
China's aquatic exports to the U.S.
Chinese delegation headed by Vice Premier Liu He will visit
Washington from today to sign the deal.
The interim deal signals a de-escalation in a trade war that
threatens to dampen global economic growth.
The looming U.S. corporate earnings season also remained on
investors' radar, with the big banks scheduled to report results on
The currency showed mixed trading against its major counterparts
in the Asian session. While it rose against the yen and the pound,
it held steady against the franc. Versus the franc, it
The greenback rose to 0.6895 against the aussie and 0.6622
against the kiwi, from its early 6-day low of 0.6920 and a 4-day
low of 0.6653, respectively. The next possible resistance for the
greenback is seen around 0.67 against the aussie and 0.64 against
The greenback bounced off to 1.3065 against the loonie, from an
early low of 1.3045. If the currency rises further, it may locate
resistance around the 1.33 level.
The U.S. currency appreciated to 1.2961 against the pound, its
biggest since December 26. On the upside, 1.27 is possibly seen as
the next resistance for the greenback.
Data from the Office for National Statistics showed that the UK
economy shrank in November due to the weakness in services and
Gross domestic product contracted 0.3 percent on month driven by
the falls in services and production. GDP had advanced 0.1 percent
in both September and October. Economists had forecast GDP to
Nearing the key 110 level, the greenback touched 109.92 against
the yen, which was its strongest since May 27, 2019. The greenback
is likely to locate resistance around the 112.00 level.
The greenback reversed from an early 5-day low of 1.1136 against
the euro, recovering to 1.1113. The greenback may locate resistance
around the 1.10 area.
Data from Destatis showed that Germany's wholesale prices
continued to decline in December.
Wholesale prices decreased 1.3 percent year-on-year in December
but slower than the 2.5 percent decline seen in November. This was
the sixth consecutive fall in wholesale prices.
In contrast, the greenback declined to a 4-day low of 0.9718
against the franc from Friday's closing value of 0.9723. Further
decline may lead it to a support around the 0.96 level.
Looking ahead, the U.S. monthly budget statement for December
will be released in the New York session.
US Dollar vs CAD (FX:USDCAD)
From Jul 2020 to Aug 2020
US Dollar vs CAD (FX:USDCAD)
From Aug 2019 to Aug 2020