USD Resumes Bullish Tone

U.S dollar made its way up against a basket of currencies marked by the weakening of the euro and plunging of the sterling. With this, the U.S dollar index, a measure of the greenback’s strength versus the known six major currencies, increased by 0.21% to 100 after the plunge on Monday over the failed healthcare bill.

USD rebounded from a four-month low and got back on track after making continuous gains. Risk appetite of investors was restored after economic data and renewed stimulus hopes from the US President Donald Trump. Both S&P 500 Index and Down Jones increased by 0.7%.

For the EUR/USD, it fell by 0.27% to 1.0736 compared to the recorded four-and-a-half month highs of 1.0905. Furthermore, the dollar went up against the yen at 111.03 after closing at 110.10 previously.

Also, the sterling went a bit lower counter to the dollar, making GBP/USD tumbling 0.12% to 1.2418. The decline of the sterling against the dollar can be credited after the Article 50 was triggered by British Prime Minister Theresa May.

In addition to this, the Australian and New Zealand dollars went sliding down against the U.S. dollar with 0.16% at 0.7658 for the AUD/USD and 0.2% at 0.7017 for the NZD/USD. Whereas the USD/CAD found support with 1.3415, as the Canadian dollar was boosted by the rising oil prices after the supply interruptions in Libya.

The rise of the dollar can also be attributed to the strong U.S consumer confidence data of the previous session. The U.S Consumer Board released a statement that the consumer confidence index leaped to 125.6 over the last 17 years. It helped to propel Treasury yields and stocks higher.It is greatly high compared to the reported 116.1 the last month. Another factor is due to the pronouncement made by Charles Evans (Chicago Federal Bank President) and Robert Kaplan (Dallas Fed President) that the Central Bank of the United States will carry on its monetary tightening cycle. It is expected that several Federal Reserve speakers are to make headlines for the next couple of days.

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