Posted August 10, 2010
The US dollar improved against the yen and the euro. The dollar also improved against the pound.
During the Monday trading session, the US dollar managed to improve for the day against the yen, euro and the pound. The day of trading was fairly calm as investors came off the concerns of last week with the US jobs report lacking good news. Investors are waiting to learn more about the global economy before making significant investments across the board. Tuesday's meeting of the US central bankers may help play a role in the movements of the markets for the rest of the week.
The US dollar make significant improvements during the Monday trading session against the poor nonfarm payroll data released on Friday. Investors are still moving cautiously this week and taking fresh positions. They are biding their time until the Federal Reserve has its rate setting meeting and announcement on Tuesday. It is likely that the markets will respond to any changes or holds on these key lending rates.
During the trading day, the US dollar high highest against the sterling later in the day. The dollar improvements occurred during the early afternoon for the ICE dollar Index and the euro. However, the way the markets respond to the news from the Federal Open Market Committee will determine what direction the markets move for the rest of the week.
However, the modest improvements for the US dollar on Monday show that the euro's run up that occurred during the Friday trading session, when the euro moved to US $1.3334 may have been an overreaction by investors. Now, investors are taking a second look at the information out of the US and correcting their positions.
Also notable during the currency trading session on Monday was the movements in the Japanese markets. The Bank of Japan is on the minds of currency investors. Investors will watch for any signs on Tuesday that the Japanese bank may be looking to reduce the gains of the yen that have occurred recent. The dollar's fall to Y 85 level has many concerned. With a global economy concern, investors have turned to the yen as a safer alternative to the riskier currencies of the euro and the US dollar. However, most experts do not expect the Bank of Japan to intervene in the currency markets. They will look for any changes or shifts that could water down the yen though.
By The Numbers
During the trading session on Monday, the dollar made significant improvements especially since the euro climbed to highs not seen in three months against the US dollar during the Friday session.
BY the end of the day Monday trading in New York, the euro moved from US $1.3294 as of late Friday to US $1.3225. The euro moved from Y 113.51 to Y 113.57 for the day. The US dollar moved from Y 85.40 to Y 85.84. The US dollar moved from US $1.5968 to US $1.5900. The US dollar moved from CHF 1.0377 to CHF 1.0484. The ICE Dollar Index moved the dollar from 80.317 to 80.700.