Connect with us

Hi, what are you looking for?

Investing Ideas

Dollar slips in muted trading as Fed meeting looms; Bitcoin tops $40,000

Forex1 hour ago (Jun 14, 2021 09:40AM ET)

(C) Reuters. FILE PHOTO: An employee of the Korea Exchange Bank counts one hundred U.S. dollar notes during a photo opportunity at the bank’s headquarters in Seoul April 28, 2010. REUTERS/Jo Yong-Hak/File Photo

By Saqib Iqbal Ahmed and Saikat Chatterjee

NEW YORK (Reuters) – The dollar edged lower against a basket of major currencies on Monday but its moves were largely muted as traders awaited a much-anticipated U.S. Federal Reserve meeting later this week that might signal a change in the outlook for U.S. monetary policy.

Currency markets settled in tight ranges with implied volatility plumbing to multi-year lows after last week’s strong inflation readings and a dovish European Central Bank meeting failed to dislodge currencies from recent trading levels.

“It’s all about the FOMC this week, and we’ll be watching to see exactly how much taper talk has really been going on and if it has any impact on the medium term outlook,” Brad Bechtel, global head of FX at Jefferies (NYSE:JEF), said in a note.

“My guess is that (Federal Reserve Chair Jerome) Powell deftly kicks the can down the road once again and pushes the time frame for any ‘real’ taper talk to later in the summer,” Bechtel said.

The dollar index, which measures the greenback against a basket of six currencies, was up 0.1% at 90.427. Last week the index rose 0.4%, its largest weekly change in five weeks.

Muted FX moves in recent weeks crushed the Deutsche Bank (DE:DBKGn) FX Volatility Index down to 5.6 on Friday, its lowest in nearly 16 months.

“Many currency pairs have been in incredibly tight ranges for weeks, if not months, now and though we can’t see that continuing for too much longer, sadly it’s too hard to call a likely side for now,” said John Marley, CEO of forexxtra, a London-based FX consultancy.

The Fed begins a scheduled two-day policy meeting on Tuesday. Nearly 60% of economists in a Reuters poll said a much-anticipated taper announcement will come in the next quarter, despite a patchy recovery in the job market.

Recent data pointing to a surge in inflation has raised concerns that price pressure following the post-COVID economic reopening could force policymakers into an earlier tapering of currency-depreciating stimulus.

Sterling was largely unmoved by Monday’s news that Britain is set to delay the end of social distancing measures as the government seeks to contain a rapid rise in COVID-19 infections.

In cryptocurrencies, bitcoin traded above $40,000, for the first time in more than two weeks, after getting an almost 10% lift on Sunday, when Tesla (NASDAQ:TSLA) Inc CEO Elon Musk tweeted that the electric carmaker will allow bitcoin transactions again when miners who verify transactions use more renewable energy.

Dollar slips in muted trading as Fed meeting looms; Bitcoin tops $40,000

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

Uncategorized

Neque porro quisquam est, qui dolorem ipsum quia dolor sit amet, consectetur, adipisci velit, sed quia non numquam eius modi tempora incidunt.

Uncategorized

Nemo enim ipsam voluptatem quia voluptas sit aspernatur aut odit aut fugit, sed quia consequuntur magni dolores eos qui ratione.

Uncategorized

Quis autem vel eum iure reprehenderit qui in ea voluptate velit esse quam nihil molestiae consequatur, vel illum qui dolorem eum.

Uncategorized

Neque porro quisquam est, qui dolorem ipsum quia dolor sit amet, consectetur, adipisci velit, sed quia non numquam eius modi tempora.

Disclaimer: Buzzclever.com it's managers and its employees (collectively "The Company") do not make any guarantee or warranty about what is advertised or above. Information provided by this website is for research purposes only and should not be considered as personalized financial or health advice. Copyright © 2021 Buzz Clever. All Rights Reserved