A quiet US session after the dollar gapped higher over the weekend. The greenback benefited from expectations that the Federal Reserve is closer to tightening. New Homes Sales, the Markit US Composite PMI and Dallas Fed Manufacturing index each came out weaker than the prior month. However, it did not stop the dollar from rising nor the S&P 500 from reaching 2000 for the first time ever (it closed below the level at 1997.92).
Meanwhile, in Europe, the prevailing sentiment is that the ECB has a long way to go before they think about tightening and are more likely to add additional stimulus. This helped lead to the EUR/USD falling about 50 pips from Friday's closing levels.
The GBP/USD was more supported in trading today , although it was a holiday in the UK.
The New Zealand dollar was under pressure against most of the currency pairs ahead of the trade balance (expected to show a deficit). Political uncertainty and technical selling is also helping to push the kiwi lower.
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