U.S. Dollar Advances Amid Risk Aversion
The U.S. dollar firmed against its major counterparts in European trading on Monday, as a rapid surge in coronavirus cases triggered worries about the pace of global economic recovery.
Friday’s weak U.S. retail sales data suggested that a flare-up in coronavirus infection has curbed the consumer spending in the world’s largest economy.
Janet Yellen will appear before the Senate Finance Committee on Tuesday for her confirmation hearing as Treasury Secretary.
Yellen is expected to affirm that the value of the U.S. currency should be determined by markets.
The Wall Street Journal reported that Yellen is unlikely to affirm the stance of a weaker exchange rate, unlike her predecessor Steven Mnuchin.
U.S.-China tension prevailed as the Trump administration notified several Huawei suppliers that it’s revoking their licenses to work with the Chinese firm.
U.S. markets remained closed on account of the Martin Luther King Jr. holiday.
The greenback jumped to 0.8926 against the franc, its biggest level since December 7. The dollar is poised to find resistance around the 0.92 level.
The greenback appreciated to a 6-day high of 1.3520 against the pound and a 1-1/2-month high of 1.2056 against the euro, from Friday’s closing values of 1.3576 and 1.2075, respectively. The greenback is likely to challenge resistance around 1.34 against the pound and 1.18 against the euro.
The greenback spiked up to near a 2-week high of 0.7659 against the aussie, near 3-week high of 0.7096 against the kiwi and a 1-week high of 1.2799 against the loonie, compared to last week’s closing values of 0.7702, 0.7125 and 1.2737, respectively. On the upside, 0.75, 0.68 and 1.299 are likely seen as its next resistance levels against the aussie, the kiwi and the loonie, respectively.
The greenback recovered slightly to 103.84 against the yen, from an Asian session’s low of 103.69. This may be compared a 4-day high of 103.93 set at 7:00 pm ET. If the greenback rises further, it may find resistance around the 106.00 level.
Looking ahead, at 8:15 am ET, Canada housing starts for December are scheduled for release.
The material has been provided by InstaForex Company – www.instaforex.com