- Consumer confidence weakens in early November in the US.
- Differences between Senate and House tax plan proposals underpin the demand for the buck.
- Inflation data from the U.S. will be the primary catalyst next week.
US DOLLAR RECOVERS MODESTLY FROM DAILY LOWS, REMAINS IN THE RED
After plummeting to a fresh weekly low at 94.16, the US Dollar Index, which tracks the greenback against a basket of six trade-weighted peers, retraced a small part of its daily losses and was last seen at 94.30, where it was still down 0.15% on the day.
Disappointing consumer sentiment data weighs on the USD
Following Thursday’s sharp retreat, the DXY fluctuated in a tight consolidation channel during the first half of the day on Friday before losing its traction in the NA session. According to the data released by the University of Michigan, the Consumer Confidence Index eased to 97.8 from 100.7 and missed the market expectation of 100.7.
DOLLAR RECOVERS MODESTLY
In the meantime, concerns over the corporate tax cut being delayed until 2019, which have been the main reason why the greenback suffered heavy losses yesterday, eased a little after the US Treasury Secretary Steven Mnuchin’s comments, allowing the USD to erase some of its daily losses. Mnuchin said there were minor differences between House and Senate tax bills and they were looking for ways to reconcile them.
- US Tsy Sec. Mnuchin: Looking forward to getting tax bill to President in December
Next week, the CPI data on Wednesday will be the main driver for the greenback’s price action. “US headline inflation may dip back following a fall in gasoline prices. But pipeline pressures are continuing to build and we are optimistic for the outlook for core inflation, which has been surprisingly weak of late. That’s one factor behind our call for a December Fed hike and two further increases next year,” ING analysts noted in a recent report.
- US key reports for next week: inflation and retail sales – Danske Bank
Technical levels to consider
The first technical support for the index could be seen at 93.95/94 (50-DMA/psychological level) followed by 93.10 (20-DMA) and 92.60 (Oct. 13 low). On the upside, resistances align at 95 (psychological level), 95.60 (Jul. 14 high) and 96.25 (Jul. 5 high).
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What is ‘Currency’
A few currencies, like cryptocurrencies, Bitcoin, Dogecoin and other online currencies and branded currencies are not tied to any usa. Branded currencies, like airline and credit card points, or in-recreation credit are valued on the subject of the price of the products or offerings they’re tied to. Manipulate over virtual currencies is totally decentralized, and the exchange price of a virtual foreign money can vary extensively in a quick time frame.
Nearby currencies are currencies intended for exchange over a small location and aren’t nationally subsidized. There are a wide variety of nearby currencies in the u.S.A., which itself has records of nearby currencies earlier than the status quo of the kingdom and countrywide banks. Other instances in which neighborhood currencies had been used include a kind of quasi-local forex within the form of neighborhood authorities ious which have been used as foreign money.
In almost all instances, the valuable financial institution of a rustic has the only right to problem cash for the stream. Along with a prime unit of foreign money, those banks problem fractional gadgets, usually inside the shape of cash. These normally display up as 1/100th, and 1/4th, but can at instances be as small as 1/one thousandth of the main unit of foreign money.
Investors regularly change forex at the forex marketplace, that’s one of the maximum closely traded markets in the global. An trade price is a charge at which two currencies may be exchanged in opposition to every other. These quotes may be ‘floating’ or ‘constant’; floating being that the fee of the currency changes in terms of foreign exchange marketplace mechanisms, constant currency is presently tied to another forex like gold or a currency basket.
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