Friday’s unexpectedly strong labor report from the U.S. helped to push the dollar broadly higher, and along with it, the U.S. Dollar Index which closed out last week’s trading higher for the 12th consecutive time. The dollar hasn’t encountered such a long-held rally in decades, and that is leading to analysts’ growing convictions that there is a shift in global currencies status quo.
As reported at 7:56 a.m. (BDT) in London, the EUR/USD was trading at $1.2530, a gain of 0.1% and just slightly higher than Friday’s 2-year trough at $1.25005 after the non-farms report was released. Some analysts are suggesting the possibility that the Dollar versus the Euro could drop to $1.10 within a year’s time. However, in the near term, in European trading, the dollar’s rally took a pause, though likely to be a short lived one, as investors’ certainty grows that the Federal Reserve Bank will push interest rates higher by the middle of next year. The U.S. Dollar Index was trading at 86.636 .DXY, just off Friday’s 4-year peak at 86.746. DXY; the index has gained nearly 8% this year.
New Trading Band for USD/JPY?
The USD/JPY came off a 6-year high at 110.09 Yen and was trading at 109.55 Yen. Currency strategists say that the USD/JPY pair seems to be trading within a new range, with a top end likely approaching the 115 Yen level and the lower nearer to 108 Yen.