USD Struggles To Prove Power
Helen Rush | Oct 04, 2017 12:08PM ET
The dollar finally returned to the Earth and USD-bulls are retreating across the board. USD lost almost all its key drivers.
The markets don’t cheer the high chance of a rate hike in December, Trump’s tax reform is not an open and shut case and most of all J. Powell is now the main candidate to replace for Federal Reserve Chair Yellen. Why is it not dollar-positive? Because Powell is considered to be a dove.
EUR took advantage of the dollar’s infirmity. Investors don’t see any danger in Catalan crisis, at least for the time being. EUR/USD wasn’t able to break through the round figure and psychological support at 1.1700 and returned to the mid-1.1700 area. If the EUR-bulls want to rule the show they’ll need to surpass the local resistance of 1.1780. A hefty jump in the ISM non-manufacturing index has pushed the dollar higher and EUR/USD is struggling at 1.1750. The decline, however, will probably be short term because the markets are waiting for the central banks' heads Draghi and Yellen speeches to decide where to go next.
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