29th Jul 2014 08:14
CANBERA (Alliance News) - The US dollar climbed against its major opponents on Tuesday, as traders look forward to a series of US economic events this week.
The Federal Reserve will commence its two-day monetary policy meeting on Tuesday. The central bank is expected to further reduce its monthly asset purchase program by USD10 billion, as it is on course to wind down the scheme later in the year. Market participants are closely focusing on the Fed statement for indications about interest rate outlook, in the light of recent spate of upbeat economic reports.
The second quarter GDP report, to be released Wednesday, is expected to show a recovery in economic growth, following the sharp contraction in the first quarter. Friday's US jobs data is expected to show a 230,000 gain in jobs for July.
Interest-rate increases may come "sooner and be more rapid than currently envisioned," if the labor market shows sustained economic recovery, Fed Chair Janet Yellen told lawmakers this month.
The greenback, which ended Monday's trading at 1.3439 against the euro, rose to 1.3426. If the greenback extends its gain, 1.337 is seen as its next possible upside target level.
Germany's import prices continued to decline in June, data from Destatis showed.
Import prices were down 1.2% year-on-year in June, slower than the 2.1% decrease seen in May. The rate of decline came in line with economists' expectations.
The greenback climbed to a 4-day high of 1.6967 against the pound and held steady thereafter. The pair was valued at 1.6981 at Monday's close. The next possible upside target for the greenback is seen around the 1.69 mark.
The International Monetary Fund advised the UK to tighten its monetary policy if new regulations introduced to contain overheating in the housing market prove ineffective.
The IMF late Monday said the monetary policy should stay accommodative until inflation show signs of rising or that costs move ahead of productivity growth. However, the lender said interest rates might need to be raised quickly if inflationary pressures intensify.
The greenback appreciated to 102.00 against the yen, its strongest since July 7. On the upside, 102.5 is seen as next possible resistance level for the greenback. At Monday's close, the pair was worth 101.84.
Japan's retail sales fell 0.6% on year to 11.351 trillion yen in June, data from the Ministry of Economy, Trade and Industry showed. That missed forecasts for a decline of 0.5% following the 0.4% drop in May.
The greenback advanced to 0.9050 against the franc, compared to Monday's closing value of 0.9038. The greenback is likely to eye resistance around the 0.91 level.
The greenback ticked up to 1.0812 against the loonie, coming off from an early session's low of 1.0795. The greenback may challenge resistance at the 1.09 mark.
Recovering from an early 4-day low of 0.9415 against the Australian dollar, the greenback edged up to 0.9389 and held steady thereafter. Continuation of bearish trend may lead the greenback to a resistance around the 0.93 mark. The greenback spiked up to a 7-week high of 0.8506 versus the NZ dollar, after falling to 0.8556 in prior deals. The greenback is poised to challenge resistance around the 0.845 region.
Looking ahead, UK mortgage approvals for June are due shortly.
From the US, S&P/Case-Shiller home price index for May and consumer confidence for July are to be released in the New York session.
Copyright RTT News/dpa-AFX