Tuesday witnessed the US Dollar regaining the 1.67% it lost recently. Investors are on edge with central bank meetings, and data releases indicate new information on the rates.
Meanwhile, the Euro dipped 0.3% as experts forecast the ECB’s dovish tendencies in the next meeting. As a result, the currency traded near 1.1598 dollars, almost touching its one-week low.
Forex trading brokers witnessed another overnight change with the Dollar easing on the Sterling, Kiwi, and Aussie. The currency traded steadily on Tuesday, except for a minor rise in the Yen and a small dip in the AUD. The USD index surged to 93.856, presenting a positive outlook for the week.
Westpac analysts stated that the Dollar is finding stability near the mid-93s. The reason behind the trend is the focus on the European Central Bank’s meeting and the release of the US growth data.
The week will witness investors eyeing the US Q3 GDP and the ECB. The market expects the European Central Bank to release dovish guidance while the US GDP may show rebound stalling. However, price pressure is building, setting scenarios where the Fed will soon announce a reduction in bond purchases.
Similarly, central bank meetings in Canada and Japan will also take place this week. In addition, Australia will also release its quarterly inflation data amid the RBA’s dovish outlook.
The AUD reached 0.7503 dollars after touching 0.7546 dollars the previous week. Since July, the currency held its peak for some time before going down while the Kiwi stayed near 0.7165 dollars.
After Friday, the Bank of England, the RBA, and the Fed’s meeting next week have the market on edge. Experts believe that there the chances of the Bank of England raising interest rates is above 60%.
Thus, financial tightening is natural under these circumstances. The United Kingdom also seeks focus while the Bank of England seems poised to join the rate tighteners shortly.