The U.S. Dollar Jumps on Yellen's Hike Talk
The U.S. Dollar Jumps on Yellen's Hike Talk
On Thursday, Fed Chair Janet Yellen said, improving U.S. economy has bolstered the case for raising rates and an increase could be "appropriate relatively soon." Yellen's speech came amid heightened expectations that the Federal Reserve could increase its key short-term interest rate target next month.
The U.S. dollar surged yesterday vs. a basket of currencies, positively affected by the U.S. housing data, which jumped to a 9-year high. The dollar surged to a fresh 14-year high and its index touched 101 pips, after Federal Reserve Chair Janet Yellen’s speech before the Congress.
Gold prices dropped yesterday, negatively affected by a strong U.S. data and Yellen’s speech. The yellow metal declined near the $1,211 support.
The Greenback settled at the psychological level of ¥110 vs. Yen after the number of people seeking U.S. unemployment benefits declined to the lowest level since 1973 last week.
Euro failed to settle at $1.07 negatively affected by a strong USD. The single currency traded yesterday at $1.06 as German GDP data for the third quarter of 2016 came in below expectations. The Euro is most likely to remain weak ahead of the ECB President Mario Draghi’s speech today, which is unlikely to add anything new.
Oil prices failed to maintain its previous gains as anticipations of an OPEC agreement to cut production were offset by oversupply worries. U.S. crude settled at $45 and could end the week at such level.
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The prices and news mentioned in this outlook are absolutely no guarantee of future market performance and do not represent the view of ICM Capital Limited. Financial markets can move in either direction causing profits to be made or complete losses to be incurred by the trader. Each trader must decide for themselves what their risk appetite is and ensure that correct risk management procedures are in place before placing any trades.
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