Dollar drops after recovery

Dollar surges

Friday, the greenback stood firm against its major currency rivals. According to the dollar index, which measures the dollar’s status against its six major currency rivals, the dollar was flat at 93.826.DXY; this is after edging up 0.2 percent the previous day. This is considered as the greenback’s mild bounce earlier decreasing out ahead of the second quarter United States economic growth data which is due later in the session.

The dollar touched its 13-month low after the Fed’s policy declaration about delaying the expected interest rate hikes this 2017. However, this statement received a lift on Thursday as Treasury yields rose on the back of positive United States durable goods and trade data. In addition, Economists expects the United States to have grown around 2.6% in the second quarter of 2017, from 1.4% in the first quarter.

Daiwa Securities’ senior currency strategist: Yukio Ishizuki, in accordance to the dollar’s collapse after the Federal Reserve’s meeting somehow looked overdone, and that it was natural for it to recover. He also added that the U.S. dollar could find bids if United States economic data turns out to be strong; hence, they are unlikely to see a return to the old ways when the greenback was the winner, as other countries are joining the Federal Reserve in trying to normalize monetary policies.

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