The head of the Federal Reserve Jerome Powell will testify on the Semiannual Monetary Policy Report on Tuesday and Wednesday
Greenback keeps to a two-week maximum
On Monday, the evergreen buck kept to the maximum for two weeks against the basket of other key currencies amid forecasts of a further increase in the interest rate in 2018. Reducing geopolitical risks led to a jump in demand for risky assets, and in particular, for the Japanese yen.
The US dollar index, displaying the purchasing power of the evergreen buck against the trade-weighted basket of six leading currencies, was intact keeping to 90.17, staying close to a two-week high of 90.25, reached on Friday.
Demand for the US currency is still high after recent statements by the US financial institution that with sustained economic surge more interest rate hikes are expected in 2018.
A higher interest rate, as a rule, acts as a support for the US currency, as it makes dollar assets more attractive for profit-seeking investors.
Besides this, the Japanese yen headed south against the dollar to a minimum of two months. The currency pair USD/JPY tacked on to 107.89.
The demand for the Japanese yen traditionally inches up in times of political or economic instability. When the confidence of investors increases, the value of the Japanese currency dives.
On Saturday, North Korea announced that it was suspending its nuclear as well as missile tests, and also closing its nuclear test site before the planned negotiations with South Korea as well as the United States.
In addition to reducing geopolitical risks, the degree of tension in the trade conflict between China and the United States also receded.
The common currency dived versus the US dollar. The currency EUR/USD inched down 0.13% coming up with an outcome of 1.2271.
On Friday, the single currency slumped to a two-week minimum against the evergreen buck after ECB Governor Mario Draghi repeated that the European Central Bank is going to act cautiously when it comes to curtailing financial incentives.
The United States will publish the non-farm employment change, also known as non-farm payrolls (NFP) at 15:30 MT time on February 7.
The level of non-manufacturing PMI for the United States by the Institute of Supply Management will be published at 17:00 MT time on February 5.
The Federal Open Market Committee will publish its meeting minutes on February 19, at 21:00 MT time.
Will coronavirus continue keeping the markets in fear? What releases should we wait for? Find out in the news!
Tesla stock drops in premarket trades on Thursday. Why? See the article (it's short) and use it to your advantage.