US dollar remains firm in Asia

In foreign exchanges the dollar held up after bouncing Monday from last week’s sharp losses thanks to upbeat factory figures. Analysts also suggested central banks were stepping back from last week’s hawkish comments indicating a tightening of monetary policy.

The pound was weighed by below-forecast manufacturing data while European Central Bank officials looked to temper boss Mario Draghi’s suggestion of higher interest rates.

“We’ve seen an aggressive pullback from last week’s speculative bets fuelled by the hawkish chorus of central bankers,” said Stephen Innes, senior trader at OANDA.

“The dollar recovered in part due to the (US) manufacturing report, which surprised with the highest print since August 2014. But concerns that central banks may temper the hawkish lean for fear of creating unwanted volatility remain in the back of traders minds.”

However, the greenback eased slightly against the Japanese yen following another missile test by North Korea, the latest provocation to ratchet up tensions over its nuclear weapons ambitions.

Investors are awaiting the release Wednesday of minutes from the Federal Reserve’s June policy meeting at which it raised interest rates, while key US jobs data is due on Friday.



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.

Stephen Innes

Stephen Innes

Head of Trading APAC at OANDA
Stephen has over 25 years of experience in the financial markets and currently based in Singapore as the Head of Trading Asia Pacific with OANDA. Stephen's market views focus on the movement of G-10 and ASEAN Currencies. His views appear in Bloomberg, CNBC.Reuters, New York Times WSJ and the Economist. His media appearances include Bloomberg TV & Radio, BBC International, Sky TV, Channel News Asia, ASTRO AWANI and BFM Malaysia. Stephen has an extensive trading experience in Spot and Forward FX, Currency and Interest Rate Futures, Money Market Derivatives and Precious Metals. Before joining OANDA, he worked with organisations like Nat West, Chemical Bank, Garvin Guy Butler, and Sumitomo Mitsui Banking Corporation. Stephen was born in Glasgow, Scotland, and holds a Degree in Economics from the University of Western Ontario.
Stephen Innes
Stephen Innes

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