Dollar Strengthens, Euro, and Pound Weakens
On Tuesday, the U.S. dollar continues strong in the foreign exchange market. It is as intensified concerns about the spread of the fatal coronavirus in China prompted pressure, making the currencies safer.
Meanwhile, the USD/JPY pair traded 0.2% elevated at 109.08, having tumbled as low at 108.83 overnight.
Moreover, the US Dollar Index Futures that tracks the greenback versus a basket of other currencies inched up 0.1% to 97.81.
The measure is considering the levels last seen in early December.
It was then by considerable gains in opposition to the commodity currencies in recent days.
Markets have also priced in the possibility of a decline in Chinese demand for necessary materials.
In addition, the EUR/USD pair traded at 1.1019. It was after briefly staying the 1.10 neighborhood or fresh annually low at the launch of the week.
The positive attitude around the dollar in the midst of the spread of the Chinese virus, have held the EUR/USD pair under heavy pressure. It is also in combination with global development concerns.
Analysts at FXStreet stated, “The pair remains under pressure although off Monday’s year-to-date lows near the psychological 1.10 mark.”
He added, “Dynamics around the buck are expected to remain the exclusive driver of the pair’s price action for the time being along with alternating risk appetite trends in response to developments from the Wuhan coronavirus.”
Awareness Expected Regarding the Two-Day Rate-Setting Conference
However, attention is expected before the start of the Federal Reserve’s two-day rate-setting conference on Tuesday with the idea in mind. It is along with the most recent data announcements in the U.S.
Last month, durable goods orders were due, and are on anticipation to rise by 0.3%.
In addition, the January consumer confidence index is to come in at 128 from 126.5 in December.
Early Tuesday in Europe, Sterling was also weaker. It is amid worries that the country will not be able to reach a trade deal.
The arrangement is with the EU by the end of the post-Brexit transition period at the end of the year.
Elsewhere, the yuan hindered near its lowest level in a month. It is in foreign trade on Tuesday as enhanced anxiety about the economic impact of a poisonous new coronavirus in China damaged riskier assets.
The Japanese yen is a safe-haven, trading near a three-week high versus the dollar. It happened as investors uneasily watched the death toll from the infection climb to more than 100.
Moreover, global stocks and oil prices have inched down over recent sessions. It was for the reason of fear.
The virus may possibly do further damage to China’s already damaged economy.
Get the latest economy news, trading news, and Forex news on Finance Brokerage. Check out our comprehensive trading education and list of best Forex brokers list here. Subscribe now and receive FREE updates on the market today!