Monday, the United States dollar slightly recovers against its major currency rivals after hitting a massive three-year lows recently. According to the dollar index, the greenback settled at 89.342 .DXY. Which was 0.3% higher from its previous settlement, and an inch higher from the greenback’s recent low of 88.253 last week which was considered as the currency’s weakest since 2014.
Against the euro, the dollar settled at $1.2386 EUR=, which was also 0.3% higher from its previous close. Against the Japanese safe-haven yen, the greenback inched by approximately 0.2% and settled at 106.55 JPY=.
However, analysts are claiming that the recovery of the dollar won’t last long, along with added comments that the dollar will be once again weak soon. Alvin Tan, a London-based strategist at Societe Generale mentioned that the dollar is reasserting itself, along with his comments that they are still looking for dollar feebleness this 2018 but they have returned to the January trend of a weaker dollar too hastily.
In addition, the dollar has been noticed to be slightly weak this year due to analysts’ and investors’ anticipation about central banks raising interest rates in other parts of the world soon lessen the greenback’s forecasted yield advantage.
In accordance to this, concerns about the United States pursuing a weaker dollar policy and the U.S. budget deficit heightened investor’s concerns, as these could estimate to surge to over $1 trillion in 2019, along with the government spending as well as massive corporate tax cuts.