The US dollar was off by nearly one percent against a basket of currencies today. The benchmark index which measures the value of the greenback against six major trading currencies dropped to 97.4 reversing a six day rally.
The RBA will release the minutes of its last meeting later tonight. There is also a speech by bank head Glenn Stevens which is scheduled later tonight. These events will be closely watched for any change in sentiment as well as the economic outlook.
The rally in GBP/USD has waned over the past few days after reaching a high of 1.5677. Markets had already discounted hawkish comments from the Bank of England’s chief Mark Carney last week.
EUR/USD was range bound throughout the session with a lack of news to influence a push in either direction. Several upswings mid-session failed to extend outside of the range.
CAD remains in a weak position following the Bank of Canada’s second surprise interest rate cut last week. USD/CAD is testing the 1.30 line with renewed vigour.
Yellen’s testimony midweek helped to concentrate minds that interest rates are likely to rise towards the end of the year, once and possibly even twice.
It was another tepid session for the euro despite the ongoing Greek crisis apparently drawing to a close. Greek banks are set to open on Monday following emergency aid from the European Central Bank.
The dollar gained today after unemployment figures showed a fall in the expected number of new claims. The data helped to confirm that the US labor market remains in good standing.
Cable experienced a choppy session but overall was little changed on the day. GBP/USD dropped to support at 1.5557 early on but later recovered to its previous level.