Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Indexes  >  US Dollar Index       

US DOLLAR INDEX
My previous session
Most popular
SummaryChartsNewsAnalysis 
News SummaryAll newsTweets

Dollar pares losses as equity sell-off eases

share with twitter share with LinkedIn share with facebook
share via e-mail
0
10/12/2018 | 10:03am CEST
An employee of a bank counts US dollar notes at a branch in Hanoi

LONDON (Reuters) - The dollar crept up on Friday, reflecting investor confidence in the U.S. economy, despite criticism by President Donald Trump of the Federal Reserve and a sell-off in U.S. equities.

The decline in stocks has yet to spread into foreign exchange markets, with emerging market currencies still appreciating and the safe-haven Japanese yen and Swiss franc not budging significantly.

Concern about a trade war between the United States and China and expectations interest rates will rise further in coming months have underpinned the dollar's 2.5 percent rise since July.

But a drop in U.S. Treasury bond yields and weaker-than-forecast rise in U.S. consumer prices saw the dollar shed half a percent on Thursday as traders cut their bets on Federal Reserve rate hikes.

Hedge fund have staked out their longest dollar positions since the end of 2016 and markets are focused on any tweak in data that could alter the Fed's thinking.

The dollar index <.DXY>, a gauge of its value against six major currencies, traded flat at 95 on Friday, down from its monthly high of 96.15 on Tuesday.

"We doubt the dollar will derive much further cyclical support through the remainder of the year. Political uncertainty could also undermine the dollar ahead of the mid-term elections on 6 November," said Derek Halpenny, European head of Global Markets Research at MUFG.

"The longer-term negative structural implications of the growing U.S. twin deficits will increasingly weigh on U.S. dollar sentiment," he added.

Other analysts see few signs the dollar will fall further. Fed officials said last month they expected three rate hikes in 2019.

"If the equity markets were to calm down again quickly without developments spreading to other asset markets, there is no reason in our mind why the Fed should not continue its rate hikes as planned," said Esther Maria Reichelt, an FX strategist at Commerzbank in Frankfurt.

"The dollar will be able to maintain its current strong levels for now but further appreciation potential is limited," she said.

The euro <EUR=EBS> was the main beneficiary of dollar weakness on Friday, reaching a weekly high at 1.1611 after minutes of the last European Central Bank meeting set a positive tone.

The minutes suggested the ECB was on track to normalise its ultra-loose monetary policy this year despite concern about slowing growth in Europe.

"We've heard quite a bit of comment from euro zone policymakers recently about rising inflation and the message is consistent, which is that price pressures are growing," said Kathy Lien, managing director of foreign exchange strategy at BK Asset Management.

The Japanese yen, a preferred currency in times of market turbulence, traded at 112.34 on Friday. It had strengthened to 111.83 versus the dollar on Thursday, its highest since Sept. 18.

The Australian dollar was at $0.7122, recovering from Monday's two-year low of $0.7039. The rally was aided by promising news out of China, its biggest trade partner.

Graphic: World FX rates in 2018 http://tmsnrt.rs/2egbfVh

(Additional reporting by Vatsal Srivastava)

By Tom Finn

Stocks mentioned in the article
ChangeLast1st jan.
DJ INDUSTRIAL 0.29% 25465.16 Delayed Quote.2.15%
NASDAQ 100 0.75% 7171.2542 Delayed Quote.11.89%
NASDAQ COMP. 0.53% 7525.5969 Delayed Quote.8.60%
S&P 500 -1.44% 2768.79 Real-time Quote.3.50%
US DOLLAR INDEX 0.33% 95.9 End-of-day quote.4.40%
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on US DOLLAR INDEX
02:34pCURRENCIES : Dollar Slips As Investors Digest China Growth Numbers, Political De..
DJ
01:41pEuropean Stocks Slip as Chinese Shares Rebound
DJ
01:11pGLOBAL MARKETS LIVE : PayPal, Amazon, Honeywell, P&G, Schlumberger…
11:36aEuropean Stock Slip as Chinese Shares Rebound
DJ
09:59aGlobal Stocks Tick Higher as Chinese Shares Rebound
DJ
10/18MARKET SNAPSHOT: Dow Ends More Than 300 Points Lower On Worries About Global ..
DJ
10/18CURRENCIES : Dollar Pulls Higher As High-beta Currencies Slide
DJ
10/18Investors Are Digging Gold, and Gold Miners, Again --Update
DJ
10/18Rising U.S. bond yields pose risks to greenback
RE
10/18Dow Falls More Than 300 Points
DJ
More news
Chart US DOLLAR INDEX
Duration : Period :
US Dollar Index Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends US DOLLAR INDEX
Short TermMid-TermLong Term
TrendsBullishNeutralBullish