While there may be a lot of volatility for the Dollar moving forward, the medium-term fundamentals carry a positive slant whether general market conditions improve or deteriorate.
The Japanese Yen finished the week modestly higher versus the recently-downtrodden US Dollar, but the lack of a clear breakthrough from a highly-anticipated US Federal Reserve meeting and a lackluster Bank of Japan decision give few clues on next steps for the USD/JPY.
The near-term advance in GBP/USD may gather pace in the days ahead should the fundamental developments coming out of the world’s largest economy fuel bets for a further delay in the Fed’s normalization cycle.
A quiet economic calendar on the domestic front in the week ahead is likely to see the Australian Dollar looking to external catalysts for direction cues. Continued speculation about the direction of Fed monetary policy following last week’s FOMC meeting and on-going Greek funding negotiations are likely to be in the spotlight.
Gold prices are higher for a second consecutive week with the precious metal up 1.85% to trade at $1203 ahead of the New York close on Friday. The advance comes amid sharp declines in the greenback with the Dow Jones FXCM U.S. Dollar Index (Ticker: USDOLLAR) down 0.71% on the week following the FOMC’s June 17 interest rate decision.
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