Dollar ahead of Powell / Yellen Testimony | IFCM
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Dollar ahead of Powell / Yellen Testimony

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Treasury Secretary Janet Yellen and Fed chair Powell due to testify today and tomorrow. USD Index ahead of testimony strengthened in early Asian and European season. DXY trading 0.32% higher, above 92.05.

Between the significant currencies, JPY traded 0.10% stronger than the Dollar and sent the USDJPY down to 108.70. And the main daily loser was Kiwi with a 1.4% loss to 0.7056, hitting a three-month low after the "New Zealand government announced new measures to try and cool its fast-growing property market by increasing the supply of houses and removing tax incentives for speculators." (Bloomberg)

Today, the financial market's main focus will turn to the U.S. and testimony where Janet Yellen will have her first joint testimony as Treasury Secretary before the U.S. House Committee on Financial Services. However, we should not forget the U.K. employment published data, where shows a bit increase in employment level, with unemployment falling to 5.0% and -147K in employment change 3M/3M (MoM) (Jan, better than -167K expected, which helped the GBP to stop lore lose against main currencies, as well as USD. GBPUSD trading 0.12% lower at 1.3847.

This month and by now, United States Dollar gained about 2% while supported by Bond Yields. Fed officials and Mrs. Yellen plaid it down and emphasized that they have enough tools to control the curve.

The most focus of today's questions and tomorrow must be about FED's supper-easy monetary policy's potential risks. Simultaneously, general FED pandemic response and Bond's Yield limit raise will also be other topics to be asked.

Besides testimony, this week, "the U.S. Treasury will sell $60 billion of two-year notes later Tuesday, $61 billion of five-year notes on Wednesday and $62 billion of seven-year notes on Thursday." (Reuters). With current situations and super-easy policy of FED, it is much interested in a market participant to get involved in stock markets or even digital currencies, rather than involving to low-income Bonds, which again probably will help the Yields to rise, after eased to 1.67% in early Tuesday trade, after climbing above 1.75% last week. Higher Yields also will push USD higher.


Details
Author
Ahura Chalki
Publish date
01/12/23

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