Dollar buying gathers momentum, puts pressure on metals

The US dollar continued to rally against most major currencies on Friday, which put weighed down on precious metals and attracted safe-haven demand.

 

Data showed that the US durable goods orders index rose 0.4% in August, beating analysts' forecasts of 1.1%.

 

The core reading of the durable goods orders index (excluding energy and food prices) rose 0.4% in August, also lower than forecasts of 1%.

 

Several FOMC members issued conflicting statements, as some stated that the US economic crisis is worse than it appears, and others expressed that the economy would recover from the pandemic soon.

 

Bearing in mind that Fed Chairman Jerome Powell stressed in his testimony before the US Congress that the ball is now in Congress' court to support US companies most hit by the coronavirus.

 

The dollar index rose against a basket of currencies by 0.3% to 94.6 points as of 19:42 GMT, after it hit a high of 94.6 and a low of 94.1.


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Posted By laraparker : 26 September, 2020
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At 12:30 GMT, the US economy released its reading of the GDP (final release), which decreased by 31.4% in the second quarter of 2020, the lowest reading ever in the US, but better than forecasts for a contraction by 31.7%, and better than the first reading of a contraction by 31.7%.

Euro fell in European trade away from week highs against dollar on profit-taking while still heading for weekly gains as global sentiment improves.    EUR/USD fell 0.4% to 1.1695, after closing up 0.2% yesterday, marking a week high at 1.1769.    The common currency is up 0.7% so far this week, which would be the largest weekly profit since July.    The best weekly gains in two months come following hopes of a new stimulus package in the US from Covid 19.    Now investors await a spate of data from Europe on inflation as Covid 19 cases surge back across the continent.    Europe's consumer prices are expected down 0.1% in September after a 0.2% drop in August.

The US dollar rose against its peers on Tuesday, to rebound from its 3-week low that hit yesterday.   Investors focused on the corporate business results season for the third quarter, amid expectations improvement from the pandemic impact.   The International Monetary Fund estimated the global GDP to shrink by 4.4% in 2020, but will grow by 5.2% in 2021.   The IMF also warned in its October's report of a slowdown in the global recovery path from the coronavirus impact.   Data showed today that the US consumer price index rose 0.2% in September, on par with economists' forecasts.   The dollar index rose against a basket of currencies by 0.5% to 93.5 points as of 18:37 GMT, after it hit a high of 93.5 and a low of 93.03.


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