Let’ us check the market. After a 0.6% gain from Tuesday, the United States dollar was stable against the Swiss franc at 0.9201. Data showing United States home sales surged to their highest level in nearly 14 years in August bolstered the dollar on Tuesday.
The U.S. dollar index pits the dollar against a basket of six major currencies. So, on Wednesday, the index rose to a high of 94.25. It is the highest in two months.
The Australian dollar decreased to a six-week low of $0.7116. Meanwhile, the Australian dollar fell 0.56% to $0.6597.
New Zealand’s Reserve Bank held its policy rate at 0.25%. Nevertheless, it warned of business closures and job losses. Thus, it reinforced forecasts that it would move to negative interest rates in the coming months.
German recovery globs slower than were forecast. The greenback gained against. Respond to the second wave of coronavirus rattled investors. Unexpectedly, French business activity slowed.
The United States Economic Data
Concern about the second wave of coronavirus infections and positive United States economic data met tepid European indicators. Thus, the United States dollar pushed higher. Meanwhile, the euro fell to a two-month low on Wednesday.
During weakness in domestically driven services, data showed that the private sector of Germany recovered less than forecasted. So, the United States dollar edged up to $1.1671 per euro. Since July, it is its highest indicator. Furthermore, the consumer morale of Germany improved less than expected. That is what the survey showed.
Traders of the pound and the euro are concerned that Britain and the European Union will disagree on a free trade deal. It will cause additional economic strain.
Commerzbank analysts, in a morning note, wrote that second wave of coronavirus, above all in Europe, dominates the market once again. So, it means that the United States dollar is in demand.
The United States dollar, most probably, will continue to gain.
That is the situation of the U.S. dollar.
- Trading Instrument