U.S. Dollar Strengthens Amid Rising Risk Aversion
26 Agosto 2020 - 5:49AM
RTTF2
The U.S. dollar climbed against its major counterparts in the
Asian session on Wednesday, as investors became cautious ahead of
Federal Reserve Chair Jerome Powell's speech at the Jackson Hole
Symposium on Thursday.
Powell is expected to provide more clarity on the U.S. central
bank's view on inflation and monetary policy.
Powell may give hints about the central bank's monetary policy
framework review, which has focused on a new inflation
strategy.
Analysts have suggested Powell will signal an increased
tolerance for higher inflation, with some predicting he will call
for a shift to "average inflation" targeting rather than the
long-standing 2 percent target.
Yesterday's economic data proved to be a mixed bag. While the
consumer confidence index dropped to 84.8 in August, new home sales
rose above 900,000 annualized in July.
U.S. durable goods orders for July are due later in the
session.
The greenback appreciated to 1.1807 against the euro and 1.3126
against the pound, from its early lows of 1.1839 and 1.3158,
respectively. The greenback is poised to find resistance around
1.16 against the euro and 1.28 against the pound.
The greenback edged higher to 0.9104 against the franc and
1.3191 against the loonie, after falling to a 5-day low of 0.9068
and a 2-day low of 1.3159, respectively in early deals. On the
upside, 0.94 and 1.33 are likely seen as the next resistance levels
for the greenback against the franc and the loonie,
respectively.
The greenback recovered to 0.7187 against the aussie and 0.6545
against the kiwi, up from its early 5-day low of 0.7207 and a 2-day
low of 0.6562, respectively. The greenback is likely to challenge
resistance around 0.70 against the aussie and 0.63 against the
kiwi.
In contrast, the greenback fell to 106.25 against the yen from
yesterday's closing value of 106.38. Next key support for the
greenback is likely seen around the 104.00 level.
Looking ahead, Swiss economic sentiment index for August is due
in the European session.
In the New York session, U.S. durable goods orders for July are
scheduled for release.
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