The US dollar increases, despite a pessimistic outlook by the Fed of Boston President Eric Rosengren

OFX Daily Market News

Posted by OFX

USD – United States Dollar

It is a very light day for economic data in the US. However, Fed of Boston President Eric Rosengren expects a weak economic rebound from coronavirus related shutdowns and said more than 200 lenders had begun registration for the Main Street Lending Program. He also sees unemployment remaining above 10% in the second half of this year, with inflation persisting under the Fed’s 2% target. During his presentation to lawmakers this week, Fed Chair Powell said that he expects a bounceback in the labour market, but one that leaves the U.S. far short of the employment levels seen before the pandemic.

Key Movers

Technically speaking, the bearish momentum in the EUR/USD pair has set “lower highs” and “lower lows” this week. Even today, it is falling another 0.15% at the time of this writing. The following support levels for the EUR/USD pair are 1.1168 and 1.1109. And, on the upside, two resistance levels in case of a bounce are 1.1228 and 1.1302.

The Loonie has climbed in the early trading session, fuelled by rising commodity prices and improved risk sentiment on trade optimism. For instance, crude oil rallied around 4% as stronger consumption continued to push physical markets higher, even as many countries struggle to bring the coronavirus under control. Crude oil traders such as Vitol and Trafigura commented about the strength of the demand recovery in recent days. Furthermore, there was a bullish signal that indicated a tighter supply in crude oil, as Iraq agreed to compensate for falling short of its OPEC+ target in May.

However, according to Statistics Canada, retail sales were down by just over one-quarter (-26.4%) in April to $34.7 billion and have fallen by one-third (-33.6%) since physical distancing measures were implemented in mid-March.

Expected Ranges

USD/CAD: 1.3545 – 1.3602 ▼

EUR/USD: 1.1169 – 1.1222 ▼

GBP/USD: 1.2352 – 1.2466 ▼

AUD/USD: 0.6777 – 0.6920 ▼

NZD/USD: 0.6385 – 0.6450 ▼


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