Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Dollar set for 4th weekly drop on dovish Fed; loonie at 3-year high

Economic IndicatorsApr 29, 2021 10:00PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. A U.S. Dollar banknote

By Kevin Buckland

TOKYO (Reuters) - The U.S. dollar skidded toward a fourth straight weekly decline against a basket of major peers on Friday, as the Federal Reserve stuck to its message of ultra-low interest rates for longer.

The dollar index was on course to end the week 0.2% lower, bringing its losses for April to 2.8%. A four-week losing streak would be the longest since the six-week slide to the end of July, and the monthly loss would also be the biggest since July's 4% slump.

The Canadian dollar climbed to a more-than-three-year high of C$1.2273 per greenback on Friday, on track for a 1.7% weekly gain that would be its biggest since the start of November.

At the conclusion of the Fed's latest policy meeting on Wednesday, Chair Jerome Powell acknowledged the U.S. economy's growth, but said there was not yet enough evidence of "substantial further progress" toward recovery to warrant a change to policy.

That growth accelerated in the first quarter, buoyed by government stimulus cheques, setting the course for what is expected to be the strongest performance this year in nearly four decades.

Signs that a strengthening economy, particularly in the labour market, might force the Fed into an earlier tapering of its asset-purchase programmed had pushed the dollar index, or DXY, to a five-month high at the end of March.

"DXY may attempt a rebound in coming days as expectations turn to a potentially blockbuster April payrolls next week, but gains will prove short-lived with Fed officials to underscore Powell’s resolutely dovish stance," Westpac strategists wrote in a client note.

The gauge is likely to drop below 90 in the near term, from 90.6 currently, but the "DXY's depreciation trend is likely more of an ongoing grind than a wholesale sharp setback," they said.

The Fed's dovishness was in marked contrast to the Bank of Canada, which has already begun to taper its asset purchases. Canada's commodity-linked loonie got additional support from a surge in oil prices to a six-week peak.

Higher commodity prices also supported the Australian dollar, which gained 0.2% to $0.77795, climbing back toward the six-week high of $0.78180 touched Thursday.

The euro has largely flat at $1.2122, near the two-month high of $1.2150 set the previous session. The shared currency is up 0.2% for the week and 3.3% for the month.

The yen saw opposite fortunes, hurt by a recovery in U.S. Treasury yields and a rally to record highs for global stocks that sapped demand for the safest assets.

Japan's currency changed hands at 108.86 per dollar, near the two-week low of 109.22 from Thursday, setting it up for a loss of about 1% for the week.

In cryptocurrencies, ether hovered just below a record high of $2,800.89 set on Thursday, after being lifted this week on media reports about the European Investment Bank's plans to launch a "digital bond" sale on the ethereum blockchain network.

Bigger rival bitcoin traded at $53,511.89, vacillating around that level this week after dipping as low as $47,004.20 on Sunday following a sharp retreat from the record high of $64,895.22 marked in the middle of the month.

========================================================

Currency bid prices at 119 GMT

Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid

Previous Change

Session

Euro/Dollar

$1.2123 $1.2122 +0.01% -0.78% +1.2127 +1.2117

Dollar/Yen

108.8470 108.9100 -0.05% +5.39% +109.0450 +108.8600

Euro/Yen

131.96 131.99 -0.02% +3.97% +132.1900 +131.9400

Dollar/Swiss

0.9084 0.9089 -0.05% +2.68% +0.9092 +0.9085

Sterling/Dollar

1.3954 1.3946 +0.09% +2.17% +1.3957 +1.3941

Dollar/Canadian

1.2273 1.2278 -0.01% -3.59% +1.2283 +1.2272

Aussie/Dollar

0.7776 0.7766 +0.14% +1.09% +0.7783 +0.7767

NZ

Dollar/Dollar 0.7247 0.7243 +0.06% +0.92% +0.7250 +0.7241

All spots

Tokyo spots

Europe spots

Volatilities

Tokyo Forex market info from BOJ

Dollar set for 4th weekly drop on dovish Fed; loonie at 3-year high
 

Related Articles

Dollar edges up as traders assess Fed rate hike bets
Dollar edges up as traders assess Fed rate hike bets By Reuters - Jan 17, 2022

By Joice Alves LONDON (Reuters) - The dollar edged higher on Monday as traders continued to hold on to dollars but took the view that Federal Reserve tightening plans were largely...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
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.
Continue with Google
or
Sign up with Email