US Dollar Index (DXY) trims losses following upbeat US data and returns to 96.50
US Dollar Index (DXY) trims losses following upbeat US data and returns to 96.50
The Dollar picks up, supported by strong US employment and manufacturing data.
Fed Powell reaffirmed his "wait-and-see" stance at a central bankers' summit in Portugal.
The US Dollar is trading with a mild positive tone on Wednesday, supported by strong US jobs data and a moderate improvement in manufacturing activity that eases pressure on the Fed to cut interest rates.
The US Dollar Index, which measures the value of the Greenback against the world’s most traded currencies, bounced up from three-year lows, at 95.90 on Tuesday, and is trying to return above 96.50 at the time of writing.
A firm Powell and strong jobs data support the USD
On Tuesday, Fed Powell maintained that the bank needs to know more about the potential impact of Trump’s tariffs on inflation before cutting interest rates. Somewhat later, a larger-than-expected increase in US job openings highlighted a resilient labour market and endorsed Powell’s view.
Also on Tuesday, the US ISM Manufacturing Index improved beyond expectations with the output subindex returning to expansionary levels after having contracted for the last three months.
The focus today is on the US ADP Employment Change, which is expected to show a significant increase in new jobs and might improve the investor’s hopes for Thursday’s US Nonfarm Payrolls report. Such a scenario might help the USD to extend its recovery.
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