U.S. Dollar Extends Slide Ahead Of U.S. Payrolls Data, Powell's Speech
21 August 2024 - 12:37PM
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The U.S. dollar extended its early weakness against other major
currencies in the Asian session on Wednesday, as investors awaited
revisions to U.S. payrolls data later in the day and the Federal
Reserve Chair Jerome Powell's speech on Friday.
Traders are likely to analyze the minutes of the U.S. Fed's
latest monetary policy meeting, which is to be released later in
the day, for additional clues about the likelihood of a rate cut
next month.
Later in the week, remarks by Fed Chair Jerome Powell and other
Fed officials at the Jackson Hole Economic Symposium in Wyoming are
also likely to attract attention.
According to CME Group's FedWatch Tool, there is a 73.5 percent
of a quarter point rate cut next month and a 26.5 percent chance of
a half point rate cut.
The U.S. dollar started trading lower against its major
counterparts from 15th August 2024.
In the Asian trading today, the U.S. dollar rose to nearly an
8-month low of 1.1133 against the euro, from a recent high of
1.1116. The greenback may test support around the 1.13 region.
Against the yen and the Swiss franc, the greenback fell to
2-week lows of 144.94 and 0.8521 from yesterday's closing quotes of
145.25 and 0.8540, respectively. If the greenback extends its
downtrend, it is likely to find support around 141.00 against the
yen and 0.83 against the franc.
The greenback edged down to 1.3039 against the pound, from
Tuesday's closing value of 1.3029. On the downside, the GBP/USD
pair may test support near the 1.31 area.
Against the Australia and the New Zealand dollars, the greenback
dropped to more than a 1-month low of 0.6753 and a 1-1/2-month low
of 0.6164 from Tuesday's closing quotes of 0.6741 and 0.6152,
respectively. The next possible downside target for the greenback
is seen around .68 against the aussie and 0.63 against the
kiwi.
The greenback edged down to 1.3613 against the Canadian dollar,
from a recent high of 1.3625. The greenback is likely to find
support around the 1.34 region.
Looking ahead, U.S. County employment and wages report for the
first Quarter, U.S. MBA mortgage approvals data, Canada PPI and raw
material price, both for July, and U.S. EIA crude oil data are
slated for release in the New York session.
At 2:00 pm ET, U.S. Federal Open Market Committee (FOMC) minutes
of its latest monetary policy meeting is set to be released.
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