U.S Dollar Lower Ahead of Busy Data Schedule
The U.S dollar was down versus its major trading partners early on Tuesday, apart from the faltering Japanese yen. The US data schedule is extremely heavy Tuesday, with home prices and sales, consumer confidence, and factory and services conditions releases filling up the calendar.
The Federal Reserve’s quiet period ahead of the Nov. 1-2 FOMC meeting began on Saturday and will continue until the meeting.
A quick summary of foreign exchange action heading into Tuesday shows that USD-JPY rebounded back above the 114 level, rising to 114.013 from 113.7078 at the Monday US close on a shift in risk-taking, though it has room to get back to last week’s 114.5947 peak.
The Bank of Japan will meet this week but is not expected to make any policy announcements as the Japanese economic recovery continues to lag other major economies.
USD-CAD fell further to 1.2353 from 1.2385 at the Monday US close but was virtually unchanged from the same point a day ago. The Bank of Canada begins its two-day meeting Tuesday.
A stronger labour market and rising inflation are expected to result in an asset purchase tapering announcement on Wednesday.
EUR-USD rebounded to 1.1623 from 1.161 at Monday’s US close but remained below last week’s 1.1666 peaks. The European Central Bank meets on Thursday but is not expected to make any policy changes, in contrast to expectations of tightening from the Bank of England and the Federal Reserve.
GBP-USD rose sharply to 1.3828 from 1.3765 at the Monday US close as risk-taking resumed, putting it in line with levels seen earlier last week before declines later in the week.
The Bank of England is widely expected to raise interest rates at its next meeting on Nov. 4. # U.S Dollar Lower Ahead of Busy Data Schedule
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