CURRENCIES: Dollar Skid Continues Ahead Of Federal Reserve Decision
02 May 2019 - 1:42AM
Dow Jones News
By Aaron Hankin
The greenback lost ground on Wednesday, extending its recent
slide ahead of the conclusion of a Federal Reserve policy
meeting.
The ICE U.S. Dollar Index, a measure of the buck's strength
against six of its closest rivals, fell 0.2% to 97.311, on track
for a fourth consecutive losing session.
Read: The Fed could lower an interest rate target today. Don't
get too excited
(http://www.marketwatch.com/articles/federal-reserve-interest-rate-target-51556589723)
What are analysts saying
"The past few trading days have certainly not been kind to the
dollar, despite U.S. GDP growth figures for the first quarter of
2019 smashing market expectations last week," wrote Lukman Otunuga,
research analyst at FXTM.
"A touch of caution ahead of the Fed's rate decision and the
U.S. jobs report scheduled for release at the end of the week could
be one of the factors behind the dollar's recent depreciation. The
Federal Reserve is expected to leave interest rates unchanged
today, despite Donald Trump's recent call for the central bank to
cut rates."
The Fed decision on interest rates is scheduled for 2 p.m.
Eastern time. Chairman Jerome Powell is scheduled to hold a news
conference at 2:30 p.m.
Read:The case for the Fed to keep an interest-rate hike on the
table revolves around financial stability
(http://www.marketwatch.com/story/the-case-for-the-fed-to-keep-an-interest-rate-hike-on-the-table-revolves-around-financial-stability-2019-04-30)
The movers
The New Zealand dollar was the worst-performing major currency
on Wednesday, falling as much as 0.8% after weaker-than-expected
employment data. The kiwi fell to an intraday low at 0.6628 and in
most recent trade it was changing hands at 0.6648 down 0.4%
Read:Here are 5 reasons for the U.S. dollar's upside breakout to
a nearly 2-year high
(http://www.marketwatch.com/story/5-reasons-for-the-us-dollars-upside-breakout-to-a-nearly-2-year-high-2019-04-30)
The majors
The British pound shrugged off a soft manufacturing PMI reading
to trade at $1.3087, compared with $1.3034 on Wednesday. The pound
is on track to log its fourth consecutive winning session and has
gained 1.2% on the week.
The euro was higher at $1.1237 versus $1.1215 late Wednesday.
It's the highest level for the shared currency since April 23.
The Japanese yen was marginally higher at Yen111.17.
Read:Expect a 'minor correction' of 5% before stocks march
higher, famed bull says
(http://www.marketwatch.com/story/expect-a-minor-correction-of-5-before-stocks-march-higher-famed-bull-says-2019-04-30)
On the calendar
The Federal Reserve finishes up its two-day meeting this
afternoon where the central bank is widely expected to keep
interest rates unchanged.
"The Fed finds itself in a difficult situation as U.S. data
remain relatively robust, but wages gains and price pressures
continue to be muted providing little reason for tightening at this
time," said Boris Schlossberg managing director of FX Strategy at
BK Asset Management.
Earlier in the session, the ADP employment showed a surge in
private sector hiring with 275,000 jobs added in the month of
April, topping market consensus of 180,000.
Read:ADP private-sector job growth surges by 275,000 -- but
there's a caveat
(http://www.marketwatch.com/story/adp-private-sector-job-growth-surges-by-275000-but-theres-a-caveat-2019-05-01)
And in other economic news, manufacturing activity expanded at
the slowest pace since President Trump was elected
(http://www.marketwatch.com/story/manufacturers-grow-at-slowest-pace-in-april-since-president-trump-elected-ism-finds-2019-05-01),
the Institute for Supply Management said. The index fell to 52.8%
in April, down from 55.3% in March.
(END) Dow Jones Newswires
May 01, 2019 11:27 ET (15:27 GMT)
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