The Greenback Stands Tall

On Wednesday, the Greenback rose vs. a basket of major currencies as investors are awaiting further news on the possible appointment of a hawk as Fed chair and progress on the U.S. tax reform plan.

With the Federal Reserve anticipating to hike interest rates for the third time this year, traders are awaiting who will succeed Janet Yellen as chair when her term ends in February 2018. On the other hand, traders will also focus on U.S. Beige Book data later in the day, with some likely to be wary of buying U.S. dollars aggressively after disappointing U.S. inflation data.

  • The U.S. dollar index, which measures the greenback’s strength vs. a trade-weighted basket of six major currencies, rose as much as 0.12% at 93.595 pips.

The euro fell as much as 0.14%, with EUR/USD last at $ 1.1749, down for the fifth session in a row.                                                            

Earlier today, the pound sterling wastraded at $ 1.3166, having fallen 0.18% following dovish comments by Bank of England policymakers. The Bank of England's new deputy governor pointed out that he did not support the view that interest rates probably need to hike soon, while another official said: her support for a rate rise was "very contingent on the data".       

The Greenback pushed higher vs. the yen, with USD/JPY rising 0.33% to ¥112.57.        

Gold prices settled near one day after suffering their biggest daily loss in about four weeks, as traders continued to speculate over President Donald Trump's choice of candidates to succeed current Janet Yellen next year. Gold Futures - Dec 17 fell as much as 0.4%, to settle at $1,285. The dollar remained supported against a basket of the other major currencies on Wednesday as the search for the chairperson of the Federal Reserve narrowed.

Earlier today, Oil prices edged higher to near their strongest level in about three weeks, positively affected by a decline in U.S. crude inventories and worries that tensions in the Middle East may disrupt supplies. The American Petroleum Institute (API) reported yesterday that U.S. crude supplies fell by 7.1 million barrels for the week ended Oct. 13.

Crude Oil WTI Futures - Nov 17, rose as much as 0.40%, to settle at $52.09, while Brent Oil Futures - Dec 17 was up 69% at $58.28.

Economic Calendar (all times in GMT)

  • EUR ECB President Draghi speaks in Frankfurt: (GMT 08:10) – Important
  • USD U.S. Federal Reserve Releases Beige Book: (GMT 18:00) – Medium

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