By: Barbara
As reported at 9:40 a.m. (BST) in London, the U.S. Dollar slipped slightly in early morning trading today as investors move back into risky, higher-yielding currencies. Investor sentiment is largely driving the shift, on the belief that the global economies have put the worst behind them, and struggling financial systems are finally seeing some improvement.
According to one economist, the pull back from the U.S. currency can also be attributed to speculation that the Federal Reserve will likely have to raise key interest rates later this year. Traders are expected to watch the equity markets closely, especially keeping a close eye on U.S. bond yields; bond yields rose last week following the release of U.S. Labor Department data which showed a less-than-expected decline in U.S. payroll figures.
The U.S. Dollar Index traded at 79.457 .DXY, a loss of .4% following yesterday’s slide of more than 1%. Among individual performers, the Japanese Yen slipped broadly against major currencies. The U.S. Dollar gained .2% to trade at 97.59 Japanese Yen, though in earlier trading on the EBS platform it had fallen to 97.08 Yen. The recent release of data out of Japan indicating that machine orders fell 5.4% in April, a decline that the market was not expecting, precipitated the Yen’s slippage.