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Dollar Rises To 1-week High, Posts Gains Against Major Rivals

Dollar Rises To 1-week High, Posts Gains Against Major Rivals

The U.S. dollar climbed higher against most of its major rivals on Tuesday and hit a one-week high in the process, amid a surge in the Delta variant of the coronavirus infection, and new travel curbs in several countries.

Data showing a jump in U.S. consumer confidence in the month of June aided dollar’s uptick. Traders also looked ahead to the upcoming monthly jobs data, and other key economic reports including U.S. manufacturing activity and factory orders.

The dollar rose on remarks from a few Fed officials that the central bank might tighten monetary policy sooner rather later.

Concerns over the imposition of tougher restrictions in some countries including Australia due to surging coronavirus infections contributed as well to the dollar’s uptick.

In the U.K, coronavirus cases involving the Delta variant are rising, prompting European nations such as Spain and Portugal to impose new restrictions on travelers.

Several Fed policy makers have turned hawkish recently despite a weaker-than-expected U.S. inflation reading last week.

Richmond Fed President Thomas Barkin said on Monday that the central bank has made “substantial further progress” toward its inflation goal so as to begin the withdrawal of stimulus.

Barkin added that he would decide next year whether the U.S. central bank had reached its inflation and employment goals to justify a rate hike.

In economic news, the Conference Board said Tuesday that its Consumer Confidence index for June came in with a reading of 127.3, up from a revised reading of 120.0 in the previous month.

The S&P CoreLogic Case-Shiller 20-city home price index in the US increased by 14.9 percent in April 2021, following a revised 13.4 percent growth in the previous month and beating market expectations of 14.5 percent.

The dollar index climbed to 92.19 but pared some gains subsequently. It was last seen at 92.06, up nearly 0.2% from the previous close.

Against the Euro, the dollar firmed to $1.1897, rising nearly 0.25%.

Against Pound Sterling, the dollar strengthened to $1.3844, up nearly 0.3% from Monday’s close.

The Yen strengthened to 110.55 a dollar, gaining marginally.

Against the Aussie, the dollar firmed to 0.7511, rising about 0.75%.

The Swiss franc weakened to 0.9212 a dollar, sliding from 0.9195, while the Loonie slid to 1.2401 from 1.2337, losing more than 0.5%.

The material has been provided by InstaForex Company – www.instaforex.com