The US Dollar Strengthening as Traders Await Indicators From The United States

The US dollar received support Thursday, May 27th from a belief that the US Federal Reserve is slowly but steadily moving toward a discussion of monetary tightening, while the yuan hit its highest level in three years.

Investors are sharply reducing their purchases of dollars, as they expect the trade deficit to increase in the current account balance in the United States as the world recovers from the pandemic.

But the mere suggestion of a gradual reduction in the pace of the US Fed’s asset purchases is sufficient to halt further selling, and after a sudden jump in consumer prices in April, markets are also in a state of extreme anxiety ahead of US jobs and GDP data due out today and inflation data tomorrow. Friday.

The major currencies were largely stable during the Asian trading session, as the euro reached around $ 1.2190, and the Japanese yen and the British pound retreated very slightly, reaching their lowest levels in a week.

The strength of the dollar also halted the rise of the New Zealand dollar, which recorded $ 0.7286, after hints from the Reserve Bank of New Zealand about a rate hike in 2022, which pushed the currency to $ 0.7316 on Wednesday.

The Australian dollar fell to $ 0.7732. The yuan bucked the trend, increasing to 6.7399 per dollar in overseas transactions. The dollar index held onto yesterday’s gains, and settled at 90.055.

Cryptocurrencies fell, but not erased many of the gains they made after last week’s wave of losses.