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Dollar Sellers Prevail as Focus Shifts to US Indicators and Weekend Break
Prompting Adjustments in Dollar Buying.
“Dollar Sellers Prevail as Focus Shifts to US Indicators and Weekend Break, Prompting Adjustments in Dollar Buying”
In the context of economic business, the prevailing sentiment in the London market leans towards selling the dollar. Despite a trend of dollar buying earlier this week, adjustments are now being made as market participants prepare for the upcoming weekend, which includes a three-day holiday for both the US and UK markets. The decline in US bond yields is effectively capping the upside potential of the dollar, with the 10-year bond yield retreating from 3.82% to 3.77%. As a result, European and US stock futures, along with after-hours trading, are displaying volatile movements, lacking a clear sense of direction. In anticipation of the latest US Personal Consumption Expenditures (PCE) deflator and other crucial indicators to be released during the later New York session, market sentiment appears cautious.
Regarding the dollar-yen pair, following its previous day’s peak near 140.26, it is currently struggling to sustain its upward trajectory, exhibiting a subdued performance today. During the early London trading hours, the pair experienced a downward pressure, reaching approximately 139.50. Nevertheless, it found stability in the mid-139 yen range thereafter.
The euro-dollar pair trading within the lower 1.07 range. After a modest increase from approximately 1.0720 to near 1.0740 in the Tokyo market, the pair encountered cautious trading within the lower 1.07 range during the early hours in London. Presently, buoyed by the decline in US bond yields, the pair has exhibited a slight upward movement, reaching around 1.0747. In a similar vein, the euro-yen pair has demonstrated volatility, oscillating around the 150 yen level. Like its dollar counterpart, it has encountered resistance in its upward trajectory and experienced a temporary dip to approximately 149.80 during the early London hours. However, as European stocks display signs of stabilization, it has rebounded towards the 150 yen range. Against the pound sterling, the euro has experienced notable selling pressure today. Lane, the Chief Economist of the European Central Bank (ECB), acknowledged the expectations for a shift in inflationary trends, yet emphasized the lack of confidence in reaching the terminal rate. Consequently, the market response to euro buying remains limited.
Shifting our focus to the pound-dollar pair, it is presently trading within the upper 1.23 range. Sustaining its upward momentum from the Tokyo market, it initiated trading within the lower 1.23 range and steadily advanced to the upper range during the early London hours. Currently, it has reached a peak around 1.2380. Additionally, the pound-yen pair is exhibiting strength, overcoming the consolidation phase around the mid-172 yen level and extending its gains to reach new highs at 173 yen during midday in London. Conversely, the euro-pound pair is displaying weaker performance. After encountering resistance around the 0.87 level, it has witnessed a decline towards approximately 0.8670.
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