top of page

Title: Dollar Edges Lower; Euro Recovery Gains Traction

  • Writer: analysiswatch
    analysiswatch
  • Aug 31, 2022
  • 2 min read


Aug 31, 2022 03:01AM ET


By: AnalysisWatch


The US dollar fell in early European trade on Wednesday, retreating from a 20-year high reached at the start of the week as the euro's nascent recovery gathered pace.


The US dollar index, which tracks the greenback against a basket of six other currencies, was trading 0.1 percent lower at 108.662 at 3:00 p.m. EDT, after beginning the week at a new two-year high of 109.48.


However, the dollar struggled to make further headway as members of the European Central Bank joined the fight against inflation, also expressing a strong determination to do so at the Jackson Hole symposium.


The euro plays a big role in the overall direction of the greenback, making up nearly 60% of the dollar index, and these hawkish testimonies have helped the single currency rally more than 1% from its two-decade low on August 23.


With that in mind, attention will turn later on Wednesday to the release of the Eurozone’s consumer price index for August, with annual inflation expected to accelerate to 9.0% from 8.9% in July, well above the ECB's 2% target.


According to Goldman Sachs in a recent note, both the Eurozone and the UK are headed for recession this year, but rising inflation will still force the region's two largest central banks to raise interest rates sharply.


Goldman Sachs warned that if gas prices remain high in the coming months, UK inflation could reach 22% next year, sending the EUR/USD up 0.1% to 1.0017 and the GBP/USD up 0.2% to 1.1680.


After data showed that retail sales in Japan rose more than expected in July, USD/JPY fell 0.3% to 138.39.


The risk-sensitive AUD/USD rose 0.6% to 0.6895, supported by signs of a recovery in China's manufacturing sector, given that Australia is a major exporter of raw materials to China.

Comentarios


2b94f773-a237-4da7-a599-6b42314ed9e6.png

Risk Disclosure: AnalysisWatch will not accept any liability for loss or damage as a result of reliance on the information contained within this website including data, quotes, charts and buy/sell signals. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible. Currency trading on margin involves high risk, and is not suitable for all investors. Before deciding to trade foreign exchange or any other financial instrument you should carefully consider your investment objectives, level of experience, and risk appetite.
AnalysisWatch would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore AnalysisWatch doesn’t bear any responsibility for any trading losses you might incur as a result of using this data.

bottom of page