Noor Trends News, Technical Analysis, Educational Tools and Recommendations
The dollar rose to its highest in more than two months against the euro and the yen on Thursday (February 4th), as pessimism about the outlook for the US economy subsided before the publication of important data on the jobs market.
The pound fell against the dollar, but it is trading at its highest levels in nearly eight months against the euro before the Bank of England policy meeting, which will publish results on the feasibility of applying negative interest rates.
Sentiment towards the dollar has improved recently as progress in vaccinations for the Corona virus, moves by US President Joe Biden to pass more fiscal stimulus, and better economic data have forced some investors betting on the decline of the US currency to abandon their debt positions.
The dollar faces another test on Friday, with the publication of non-farm payrolls data, which will help confirm whether the world’s largest economy weathered a slowdown in growth towards the end of last year.
Against the euro, the dollar settled at $1.2015, near its highest level in nine weeks. The pound slipped to $1.3601, after falling 0.2% in the previous session. The British currency is trading at 88.30 pence per euro, near its highest level since May of last year. The dollar hit 105.13 yen, near its highest level since mid-November.
Data to be released Friday is expected to show that the US economy added 50,000 jobs in January, which would represent a slight recovery from the 140,000 job loss the previous month as a sharp rise in coronavirus infections hampered economic activity.
Since the start of the year, sentiment has been supported by expectations of a massive fiscal stimulus under President Biden’s government. The pace of vaccinations has also accelerated in the United States, causing many investors to reduce their pessimistic outlook.
The dollar index, which measures the performance of the greenback against a basket of currencies, rose 0.2% to 91.269, not far from its highest level since early December.
It is unlikely that the Bank of England will adjust interest rates or quantitative easing at its meeting today, but the sterling is closely following as investors seek to gauge the possibility of resorting to negative interest rates.
In the cryptocurrency market, Ethereum hit a record $ 1698 before listing Ethereum futures on the Chicago Mercantile Exchange next week. Bitcoin, the most popular cryptocurrency, settled at $ 37,000 970.
The Australian dollar rose to $ 0.7626, supported by US stimulus hopes and progress in managing Coronavirus vaccines. The New Zealand dollar fell to $ 0.7195.
