US dollar markets started the week tentatively, with investors wary ahead of the first testimony from incoming US Federal Reserve Chairwoman Janet Yellen. Given the influence she will have over the future of US policies, her previous caution weighed on investors’ minds. These reservations were somewhat justified on Tuesday, as her views that the labour market recovery was ‘far from complete’ and that the tapering of the quantitative easing programme was not on a ‘pre-set course’ caused the dollar to fall to its lowest level since the end of January against sterling, while extending its losing streak against the euro to the longest in two months.
The Federal Budget Balance released on Wednesday then showed that Republicans seemed to have acquiesced by agreeing to increase the US debt ceiling to this time next year, but the dollar sunk to near two-and-a-half year lows against sterling on UK strength. Yesterday failed to help the dollar’s cause, as both retail sales and unemployment claims figures failed to meet expectations, causing further weakening. Today sees one final piece of US data, with the preliminary Consumer Sentiment from the University of Michigan, as a final point of interest.
Wondering whether to buy or sell US dollars? Call your trader for live rates now, as a wary outlook holds the dollar down.