Dollar extends gains, Fed hawk speaks today

Dollar extends gains, Fed hawk speaks today

The US dollar is higher for the third day ahead of a speech later today by long-term Fed hawk Loretta Mester. US equities are steady even after European and Asian equities moved higher. US Treasury yields are also steady. Oil and gold bounced somewhat after big sell-offs over the past week. Traders are dealing with reports of Delta variant virus cases soaring in the US as well as upcoming inflation data and differing Fed member views.

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  • FX Rates
    August 10, 2021

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  • USD

    The dollar index is broadly higher, continuing gains for the third day and up 1.40% for the month. Traders are focused on today’s speeches by Cleveland Fed President Loretta Mester, who historically has been more hawkish than other Fed officials. Her comments on inflation following last week’s strong labor data and ahead of this week’s inflation data will be scrutinized for signals on tapering.


    The British pound managed to edge higher despite a strong US dollar environment overnight. GBP strength continues to be fueled by last week’s hawkish message from the Bank of England. There were no economic releases today for the UK, but several upcoming on Thursday.


    The euro is lower, continuing a week-long trend. The euro’s recent peak at $1.1909 on July 30 has been followed by a drop of 1.5% in a little over a week. This morning’s release of the German ZEW Survey, a leading indicator of German economic activity measuring its business environment and sentiment, was much lower for August than expected and July’s data. The euro is approaching key support at $1.1700.


    The Canadian dollar changed little overnight despite the broadly stronger US dollar. Oil prices bounced off yesterday’s lows, trading near $67 per barrel. There are no Canadian economic data releases today.


    The CNY moved little overnight, remaining within a relatively tight 6.45-6.50 trading range since mid-June.

    The USD/JPY moved higher for the fifth day. After dropping to 108.72 last week, the currency pair has gained nearly 1.7%, and now faces key resistant around 110.70-80. Inflation and economic growth data for Japan will be reported this week.

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Scott Petruska
Scott Petruska

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