Dollar Climbs To Over 4-month High Versus Euro On Powell's Remarks
11 February 2020 - 9:05PM
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The U.S. dollar spiked up to a multi-month high against the euro
in early New York deals on Tuesday, after Federal Reserve Chair
Jerome Powell remarked that the economy appeared resilient to the
global headwinds and the current stance of monetary policy would
remain appropriate.
The greenback rallied to more than a 4-month peak versus the
euro and a 1-1/2-month high against the franc following Powell's
remarks.
In prepared remarks to the House Committee on Financial
Services, Powell said that some of the trade uncertainties have
waned recently, but risks to the outlook remain.
The Fed is closely monitoring the emergence of the coronavirus,
which could lead to disruptions in China that spill over to the
rest of the global economy, he said.
The Fed chief noted that the current stance of monetary policy
would support continued economic growth, a strong labor market, and
inflation returning to the 2 percent objective.
"As long as incoming information about the economy remains
broadly consistent with this outlook, the current stance of
monetary policy will likely remain appropriate," he added.
The greenback hit more than a 4-month peak of 1.0891 versus the
euro and a 1-1/2-month high of 0.9789 against the franc, from
Monday's closing values of 1.0911 and 0.9773,respectively. Next key
resistance for the greenback is seen around 1.07 versus the euro
and 1.00 against the franc.
The greenback, though, retreated to 109.75 versus the yen, from
a 4-day high of 109.95 set at 3:00 am ET. If the greenback slides
further, 108.00 is likely seen as its next support level.
Meanwhile, the greenback fell to a 5-day low of 1.2961 against
the pound, compared to yesterday's closing quote of 1.2915. The
next possible support for the greenback is seen around the 1.32
level.
Data from the Office for National Statistics showed that the UK
economy logged flat growth in the fourth quarter.
Gross domestic product remained unchanged on quarter, as
expected, after expanding 0.5 percent in the third quarter.
The greenback was weaker against the loonie and the kiwi,
reaching 1.3288 and 0.6409, down from its early high of 1.3320 and
a 3-month high of 0.6378, respectively. The greenback may locate
support around 1.30 against the loonie and 0.66 versus the
kiwi.
The greenback fell to a 4-day low of 0.6725 against the aussie,
from yesterday's closing quote of 0.6686. The greenback is poised
to challenge support around the 0.71 mark.
Data from the Australian Bureau of Statistics showed that
Australia's home loans rose in December.
The new loan commitments for housing rose a seasonally adjusted
4.4 percent month-on-month in December. On an annual basis, loans
increased 14.0 percent.
Looking ahead, at 10:35 am ET, Bank of England Governor Mark
Carney will testify before the House of Lords Economic Affairs
Committee in London.
Federal Reserve Governor Randal Quarles will give a speech about
bank supervision at the Yale Law School Dean's Lecture in
Connecticut at 12:15 pm ET.
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