Graphic Rewind: US Dollar Sways a Bit on Yellen Comments and UK Inflation
- US Dollar Index barely changed for the week
- US Dollar fails to remain lower despite a dovish Yellen
A look back at the past week of Forex trading using movements in the US Dollar Index:
US Dollar 1-Hour 17:00 11/11 to 12:00 11/15 EST
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Despite a week when our views of the US and UK economy were significantly shifted by announcements in both places, the Dow Jones FXCM Dollar Index level is barely changed from the Monday open.
The US Dollar rallied on Tuesday morning on a UK inflation rate reported at 2.2%, which was significantly lower than expected. The Pound quickly showed weakness against other majors like the US Dollar, but those Pound losses were erased over the rest of the London session.
On Wednesday, the US Dollar began a significant decline ahead of soon-to-be Fed Chairman Yellen’s speech, following her recent nomination announcement. Yellen didn’t disappoint those dovish expectations; she said that unemployment is still high and the economy needs further support. Her comments sent the greenback to the weekly low, but the losses were soon pared.
On Thursday, the US Dollar again rallied on Pound weakness, this time because of a disappointing UK industrial production release. Those US Dollar gains were again erased, this time on Yellen saying that broader unemployment measures are higher than 7.3% in s Q&A session.
Today, the Pound took gains against the greenback on BoE’s Weale’s comments that the central bank has raised its expectations for price changes and the economy is recovering better than expected. The US Dollar gains were also fostered by a series of smaller, but disappointing, US economic releases.
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Charts created by Benjamin Spier using Marketscope 2.0
-- Written by Benjamin Spier, DailyFX Research. Feedback can be sent to email@example.com .
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.