The dollar operated under pressure on Monday, the 27th, and extended last week’s losses against strong rivals, such as the euro and pound. In the global macroeconomic scenario, investors remain focused on the risks of recession in developed countries and the perspective of monetary tightening, before inflation and activity data in the US and Europe.
In the late afternoon in New York, the euro appreciated to US$ 1.0589, the pound had a slight increase to US$ 1.2278 and the dollar was up to 135.41 yen. The DXY index, which measures the variation of the US currency against six rivals, fell 0.24%, to 103.939 points.
In a report sent to customers, Western Union highlights the movement of the euro on Monday. According to analyst Joe Manimbo, the common currency has benefited from the perception of certain monetary tightening in the euro zone in the second half of the year.
ING, however, projects that the European Central Bank (ECB) will raise rates less aggressively than the Federal Reserve in the current cycle, which should limit the euro’s appreciation. For this week, however, economic recession concerns bring the reading that central banks will have to be more cautious with the interest rate hike, which could dampen the dollar’s recent strength, says the Dutch bank.
Over the course of the week, sentiment for risk in the currency market will be “tested” in light of the German consumer price index (CPI) releases and the final reading of the US Gross Domestic Product (GDP) for the first quarter. , on Wednesday, in addition to the May US Consumer Expenditure Price Index (PCE) on Thursday, highlights Manimbo. The PCE is the main inflationary indicator monitored by the Fed and considered crucial for the entity’s monetary policy.
Still among indicators, the UK’s first quarter GDP should put pressure again on the pound, whose long positions have recently gained ground, according to Rabobank. According to the institution, the stance hawkish of the Bank of England (BoE, its acronym in English) has supported the British currency.
Among the emerging ones, the Russian ruble and the Turkish lira stood out. The Russian currency appreciated against the dollar even after reports that Russia defaulted on interest payments on its sovereign debt, denied by the Kremlin. The Turkish currency has benefited from a new instrument from the Turkish government that forces companies with excess foreign exchange to have access to commercial loans in lira restricted, according to ING. At the quoted time, the dollar retreated to 53,160 rubles and 16,554 lira.
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