Greenback set for 4th weekly drop on dovish Fed; loonie at 3-year excessive By Reuters

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© Reuters. One US dollar banknote

Posted by Kevin Buckland

TOKYO (Reuters) – The US dollar slid towards a fourth straight weekly decline against a basket of large competitors on Friday as the Federal Reserve held on to its ultra-low interest rate message.

The price was on its way to drop 0.2% for the week and bring its April losses down to 2.8%. A four-week loss streak would be the longest since the six-week decline through late July, and the monthly loss would also be the largest since the 4% plunge in July.

The Canadian dollar climbed to a more than three-year high of $ 1.2273 per greenback on Friday, on the way to a 1.7% weekly gain that would be its biggest since early November.

At the end of the Fed’s final political meeting on Wednesday, Chairman Jerome Powell acknowledged the growth of the US economy but said there was not enough evidence of “significant further progress” on the recovery path to change policy justify.

That growth accelerated in the first quarter on the back of government economic reviews, paving the way for what is likely to be the strongest performance this year in nearly four decades.

Signs that a strengthening economy, particularly in the labor market, might force the Fed to cut its programmed asset purchases earlier had pushed the dollar index (DXY) to a five-month high in late March.

“DXY could seek a rebound in the coming days as expectations next week are for a potentially blockbuster April wage, but gains will prove short-lived among Fed officials to underscore Powell’s determined reluctance to hold,” Westpac wrote. Strategists in a customer report.

The gauge is likely to drop below 90 from its current 90.6 in the near future, but “the DXY’s depreciation trend is likely to be a sustained decline rather than a major setback in wholesale,” they said.

The Fed’s reluctance was in stark contrast to the Bank of Canada, which has already begun restricting its asset purchases. Canada’s commodity-linked companies received additional support from a surge in oil prices to a six-week high.

Higher commodity prices also supported the Australian dollar, which rose 0.2% to $ 0.77795 and rose back to the six-week high of $ 0.78180 hit Thursday.

The euro is broadly unchanged at $ 1.2122, near the two-month high of $ 1.2150 set in the previous session. The common currency is up 0.2% for the week and 3.3% for the month.

The yen experienced an opposite fortune, hurt by a rebound in US Treasury bond yields and a rally in record highs for global stocks that weighed on demand for the safest assets.

Japan’s currency changed hands at 108.86 the dollar, near the two-week low of 109.22 as of Thursday, translating into a loss of about 1% for the week.

In cryptocurrencies, Ether was trading just below a record high of $ 2,800.89 on Thursday after it was canceled this week due to media reports on the European Investment Bank’s plans to start a “digital bond” sale on Ethereum’s blockchain network .

Larger competing Bitcoin stocks traded at $ 53,511.89, hovering around that level this week after falling to $ 47,004.20 on Sunday after pulling back sharply from a record high of $ 64,895.22 mid-month.

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Bid prices at 119 GMT

Description RIC Last US Close Pct Change YTD Pct High Bid Low Bid

Previous change

session

euro dollar

$ 1.2123 $ 1.2122 + 0.01% -0.78% +1.2127 +1.2117

Dollar / yen

108.8470 108.9100 -0.05% + 5.39% +109.0450 +108.8600

Euro / yen

131.96 131.99 -0.02% + 3.97% +132.1900 +131.9400

Dollar / Swiss

0.9084 0.9089 -0.05% + 2.68% +0.9092 +0.9085

Pound sterling / dollar

1.3954 1.3946 + 0.09% + 2.17% + 1.3957 + 1.3941

Dollars / Canadians

1.2273 1.2278 -0.01% -3.59% +1.2283 +1.2272

Aussie / dollar

0.7776 0.7766 + 0.14% + 1.09% + 0.7783 + 0.7767

NZ

Dollar / Dollar 0.7247 0.7243 + 0.06% + 0.92% + 0.7250 + 0.7241

All positions

Tokyo spots

Europe spots

Volatilities

Tokyo Forex Market Information from BOJ

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