By: Barbara Zigah
In Asian trading today, the U.S. Dollar is seeing slight gains against the common currency Euro, which could not breach a key resistance level. Most analysts believe that declines in the Euro will likely be limited as the ECB’s policymaking committee meets tomorrow and speculation of an interest rate hike will help buoy it. As reported at 2:25 p.m. (JST) in Tokyo, the Euro was trading against the greenback at $1.3761, a decline of .1%; on Monday, the Euro struck a 1-month peak of $1.3857 but failed to breach it. The U.S. Dollar Index, a measure of the greenback’s value against other major currencies, gained .1% on the day, recently at 77.111 .DXY; in yesterday’s session, it had fallen to 76.735 .DXY, the lowest price in about four months.
The U.S. Dollar is also continuing to benefit from yesterday’s appearance by Fed Chairman, Ben Bernanke, in front of the U.S. Senate’s Banking Committee. The head of the Federal Reserve Bank informed the Senators that the recovery in the U.S. economy has still got momentum on its side, and that inflationary pressures and higher commodity prices would likely not have any long-term detrimental effect on the recovery.
Some analysts believe that the U.S. Dollar will likely be under pressure, with investors trading cautiously, until the Friday non-farms payroll data is released.