The US Dollar Index, used by FX traders to gauge the relative strength of the greenback against a weighted basket of major rivals, edged up in early European trade, helped along by Janet Yellen. In pair’s trading, the Dollar is having a mixed session. The head of the US Federal Reserve Bank is scheduled to speak again, later today, and could very well be the voice of reason and clarity awaited by investors. Yesterday, Yellen reassured that the rate hikes promised for this year will be forthcoming; she also pointed out that the Fed foresees growth and higher inflation which gave investors the reassurance that helped to lift the greenback.
As reported at 10:22 am (GMT) in London, the US Dollar Index was trasding at 101.08 .DXY, a gain of 0.15%. The USD/JPY was marginally higher at 114.647 Yen, a gain of 0.05%; the pair has ranged from a low of 114.45 Yen to a peak of 114.96 Yen in today’s trading. The EUR/USD is trading at $1.0657, a gain of 0.23%. The GBP/USD is up at $1.232, a gain of 0.47%.
China Rhetoric Worrying
Despite Yellen’s assurances, market players remain wary ahead of the inauguration of president-elect Donald Trump which will take place tomorrow. Given Trump’s rhetoric on China and a too strong Dollar, market players are tempering their bets so that they’re not caught flat-footed by anything that Trump might say at this inaugural speech. Earlier this week, Trump claimed that the strong Dollar and the trade relationship with China was “killing us” in terms of export growth.