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May 15, 2021

investors treading cautiously ,The U.S dollar index remained above lows

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The U.S dollar index remained above the most recent 1-1/2-month low against a basket of major currencies early on Monday, with investors treading cautiously ahead of the pending news on the enactment of U.S. tariffs on $200 billion of worth of Chinese imports.

In Trade, American President Donald Trump is expected to announce new tariffs as early as Monday,  according to a Reuters source. Moreover, the Wall Street Journal expects the tariff level to be nearly 10 percent, significantly below the 25 percent the administration had said it was considering.

Additionally, The WSJ also said that China might decline to attend trade discussions scheduled next week as the Chinese government will not negotiate under threat.

The U.S dollar index which measures the greenback’s strength against a basket of major currencies held at 94.965, significantly above Friday’s close 94.359 that marked its lowest level since end-July.

In Europe, the euro climbed against the declined versus the greenback on; the EURUSD lost 0.58 percent to end the session at 1.16217. Meanwhile, the single currency near 1.1630 level early Monday.

The CFTC report indicated major positioning changes in the Euro, with net shorts decreasing and net longs increasing. Meanwhile, Net shorts in sterling and the Swiss franc also declined.

The single currency and the cable both found some demand last week on promising developments in terms for Britain’s exit from the European Union.

In the United Kingdom, the Sterling pound as lost ground the U.S dollar on Friday; the GBPUSD declined by 0.32 percent to trade at 1.30644 at the close. Additionally, the sterling gained some ground against its American counterpart in early Asia on Monday to trade near 1.30821.

Regarding safe-havens, The dollar traded at 112.020 yen on Friday, Meanwhile on early the pair traded 111.98 within kissing distance of Friday’s 112.020, the USDJPY gained nearly 0.9 percent last week.

Meanwhile, the Swiss franc also lost ground to the greenback on Friday, with the USDCHF adding 0.22 percent to trade at 0.96735 at the close.


Furthermore, Investors continue to be bullish on the greenback as seen by increased demand in reserve currency with net long positions of $19.2 billion, according to the data released Commodity Futures Trading Commission (CFTC) data released on Friday.

The precious metal Gold prices saw 0.67 percent decline on Friday, to trade at 1193.69 XAUUSD at the close.

Elsewhere in Canada, Loonie fell by 0.28 percent against the greenback to trade at 1.29954 XAUUSD.

Meanwhile commodity-dependent currencies, Aussie and Kiwi dollar both continue to be outmuscled by the U.S dollar. As The Australian dollar, which is a proxy for global growth and Chinese assets, has been battered in recent months as Trump’s tariff threats became a reality; The AUDUSD and NZDUSD declined by 0.54 and 0.40 percent to end the session at 0.71535 AUDUSD and 0.65456 NZDUSD, respectively.

In Crypto-currencies world, Bitcoin, Litecoin, and Ethereum rose against the Greenback to end the trading week at 6508.81 BTCUSD, 56.42 LTCUSD, and 215.94 ETHUSD, respectively.



Ali Hwary

Ali Hwary

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