USD Starts Weaker Against JPY Ahead of Busy Week

The dollar fell against the yen and lost ground against other currencies on Monday as caution swept markets ahead of a busy week for economic data and events.

The U.S. currency fell nearly 1% against the yen in Asian trading hours, though was off the lows in morning trade in New York. The dollar has rallied sharply this month, accelerating gains after Donald Trump’s presidential election victory. The ICE dollar index DXY, -0.02% a measure of the currency against six major rivals, is up more than 3% month-to-date after hitting a 13-year high last week.

Analysts said a round of minor consolidation in the dollar may be over and that it is likely to trade sideways throughout the week.

“It is unlikely that traders will go short the dollar going into the end of the week when we are expecting a decent jobs report, Italian referendum and presidential elections in Austria over the weekend,” said Marc Chandler, global head of currency strategy at Brown Brothers Harriman.

“However, the dollar is likely to strengthen against the euro as the European Central Bank is expected to extend their quantitative easing program while the Federal Reserve is expected to raise rates in December,” Chandler said.

via MarketWatch

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza