U.S. Dollar Appreciates On Economic Recovery Hopes
02 June 2021 - 2:19PM
RTTF2
The U.S. dollar gained ground against its major counterparts in
the Asian session on Wednesday, as a pick up in U.S. manufacturing
activity added to optimism over the economic recovery.
Data from the Institute for Supply Management showed on Tuesday
that U.S. manufacturing activity expanded at a slightly faster pace
in the month of May.
The ISM said its manufacturing PMI inched up to 61.2 in May from
60.7 in April. The uptick surprised economists, who had expected
the index to come in unchanged.
Investors will be watching speeches from Fed officials Raphael
Bostic and Charles Evans, as well as the Federal Reserve's beige
book report for clues on the policy outlook.
Markets are searching for fresh catalysts, as concerns prevailed
over rising inflation that could fuel a debate about tapering QE
program.
All eyes are on U.S. payrolls data due on Friday that can shed
more light on economic recovery.
The greenback climbed to 2-day highs of 1.2200 against the euro
and 109.78 against the yen, off its prior lows of 1.2227 and
109.39, respectively. The greenback is seen finding resistance
around 1.20 against the euro and 112.00 against the yen.
The greenback hit 2-day highs of 1.2088 against the loonie and
0.7726 against the aussie, after falling to 1.2056 and a 1-week low
of 0.7773, respectively. The greenback is poised to challenge
resistance around 1.22 against the loonie and 0.75 against the
aussie.
The greenback reversed from its previous lows of 1.4164 against
the pound and 0.7272 against the kiwi, gaining to a 6-day high of
1.4128 and a 5-day high of 0.7223, respectively. The next possible
resistance for the greenback is seen around 1.37 against the pound
and 0.70 against the kiwi.
The greenback edged up to 0.8985 against the franc, from a low
of 0.8964 seen earlier in the session. If the greenback strengthens
further, it is likely to test resistance around the 0.92
region.
Looking ahead, U.K. mortgage approvals and Eurozone PPI for
April are due in the European session.
Canada building permits for April and Fed Beige book report are
set for release in the New York session.
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