It was a very quiet day on Wednesday for the US dollar, with no data releases to prod it. There was slight continued strength for the US currency, mainly due to hawkish comments from a US Federal Reserve member regarding a possible interest rate rise in June. Recent US economic data has been supportive of the view that this year’s first quarter economic performance was similar to last year and down to other factors, such as the weather and an extended port strike, and not due to systemic weakness in the US economy, hence the re-emergence of talk concerning the timing of US interest rate increases.
The G7 meeting continues today, we will also see some data releases in the form of weekly unemployment claims, which is expected to fall slightly, as well as pending home sales data. The recent strength seen by the US dollar has also been contributed by the euro’s performance, and continued euro weakness will help to boost the dollar against the Eurozone currency.