Forex Signals – Dollar Weakens
FxPremiere.com – The dollar weakened in early European trade Friday, amid doubts about the pace with which the U.S. economy will rebound from the coronavirus-inspired slowdown.
At 2:55 AM ET (0655 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, was down 0.1% at 92.662. USD/JPY was down 0.2% at 105.57, while EUR/USD was up 0.1% at 1.1868.
Dragging the greenback lower was the news Thursday that applications for U.S. unemployment benefits increased, defying consensus forecasts for a further decline, while the Philadelphia Fed reported a disappointing reading for its manufacturing index.
FX Signals
This came a day after the Federal Reserve warned that the path to U.S. economic recovery from the Covid-19 outbreak remained highly uncertain, with the recovery in hiring starting to slow – Forex Signals – Dollar Weakens
Forex – Dollar Weakens as Risk
EUR/USD Weakens After ECB Stimulus Fails
The euro has been the biggest beneficiary of a recent decline in the dollar, but this tone could be tested with the release of eurozone manufacturing data later in the session.
Forex Signals – Dollar Weakens Ahead of Sterling
That said, “the EUR has much further to go when/if the market realizes that the tail risks in the EUR are much smaller now compared to 9-12 months ago,” Larsen said, adding that the USD could weaken by as much as 20-25% over the coming two years, aiming “for (at least) >1.25 levels in EUR/USD.”
Elsewhere, GBP/USD traded 0.2% higher at 1.3240, helped retail sales rising above their pre-coronavirus level in July, as shops selling non-essential goods opened again after the lockdown in March.
Forex Signal Dollar Down Amid Rising U.S.- China Tensions
Retail sales volumes rose by a much stronger than expected 3.6% from June and were 1.4% higher than in July 2019, the Office for National Statistics said, representing a sharp recovery from double-digit falls in April and May.
Additionally, USD/CNY dropped 0.1% to 6.9071, after earlier falling below 6.90 for the first time since January.
Pound Set to Snap Losing Streak Vs US Dollar COVID-19
Join our 21,345 Subscribers Forex Signal Packages!!
![The dollar was down on Monday morning in Asia, giving up some of its gains from Friday. U.S.-China tensions rose over the weekend after White House trade advisor Peter Navarro suggested in a “This Week” interview that Beijing sent "hundreds of thousands of Chinese on aircraft to Milan, New York and around the world” to spread the virus after hiding it from the world for two months. Meanwhile, U.S. Federal Reserve Chair Jerome Powell said in a separate interview that the U.S. economy could shrink up to 30% in the second quarter but will avoid a second Great Depression in the long run. The U.S. Dollar Index that tracks the greenback against a basket of other currencies fell 0.11% to 100.325 by 11:32 PM ET (4:32 AM GMT). “At the fore of market participants’ minds is that we are seeing those (China) tensions just ratcheting higher, so there has been support for the U.S. dollar on the back of that,” Commonwealth Bank of Australia (OTC:CMWAY) FX analyst Kim Mundy told CNBC. “Also comments last week from Fed officials around the risks to the U.S. economy being skewed to the downside, risks around a second wave of infection, I think that will also continue to underpin the U.S. dollar this week.” The USD/JPY pair gained 0.10% to 107.12 after Japan slipped into recession for the first time since 2015. The USD/CNY pair gained 0.06% to 7.1058. The Trump administration blocked chip supplies to Huawei Technologies, and investors are on edge for a response after a possible Chinese retaliation was reported. The GBP/USD pair rose 0.05% to 1.211. Andrew Haldane, Bank of England chief economist, said on Saturday that the bank is considering negative interest rates. “The economy is weaker than a year ago and we are now at the effective lower bound, so in that sense it’s something we’ll need to look at - are looking at - with somewhat greater immediacy. How could we not be [looking at negative rates]?” he said in an interview with the Telegraph. Down Under, the AUD/USD pair jumped 0.51% to 0.6447. Australia added its voice to the call for an examination into China’s initial handling of the COVID-19 virus, and China suspended beef imports from four companies in New South Wales last week. But there were reports of conciliatory remarks from the Chinese Foreign Ministry. The NZD/USD pair was up 0.45% to 0.5958.](https://i1.wp.com/www.fxpremiere.com/wp-content/uploads/Forex-Signal-Dollar-Down-Amid-Rising-U.S.-China-Tensions.jpg?fit=800%2C582&ssl=1)
About The Author: Forex Signals
Forex Signals l including Opening Forex Accounts. Subscribe now for major pairs Forex Trading Signals Today by FxPremiere
More posts by Forex Signals