U.S. dollar recovers from 15-month low

US dollar

Thursday, although a bit feeble due to hesitations and speculations about the expected United States interest rate hike this year; the U.S. dollar edges away from a 15-month low. According to the dollar index, the greenback rose about 0.1% against six of its major currency rivals to 92.949.DXY, which is just an inch away from Wednesday’s 92.548 which is considered as the dollar’s weakest level since May 2016.

In addition, the euro slipped 0.1% lower to $1.1845, dropping from a two-and-a-half year high of $1.19105 set on Wednesday, which is considered as the common currency’s highest level since January 2015. The greenback remained steady against the safe-haven yen and traded at 110.76 JPY=, from a low of 109.92 earlier this week and is considered as the dollar’s lowest for more than six weeks.

The dollar’s weak performance was weighed down by political confusion gripping Washington and as well as by the weak United States Economic data, especially the slow inflation that adds to hesitation about the expected Fed’s policy tightening. However, in contrast to the political risks and the hesitation of monetary policy that has caused the greenback to fall, the euro has declared support from expectations that the ECB or the European Central Bank would eventually begin to conduct their policy.

In accordance to this, Satoshi Okagawa, senior global market analyst for Sumitomo Mitsui Banking Corporation in Singapore said that euro appears headed for the test of the $1.20. He also added that the balloon has been swelling as he refers to long positions in the euro, after a recent build-up of euro strong bets points to the risk of a pull-back.

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