Dollar Steadies as Markets Eye Fed
The US Dollar Index steadied during Asian trade and is poised to show a gain for the week. FX traders are wary, though, of the upcoming Federal Reserve policy meeting as analysts have warned that tepid global growth could soon be felt to a greater extent in the US economy, which might prompt the Fed to return to a less restrictive policy in the short term. Markets have already priced in the possibility of two rate reductions by the end of this year. Only about 11% of analysts recently surveyed believe the Fed's benchmark rate will still be at the current level until the July meeting, down from 74.1% last month.
As reported at 10:46 am (JST) in Tokyo, the USD/JPY was trading at 108.3400 Yen, down 0.0249%, moving off the session high of 108.397 Yen. The AUD/USD was trading at $0.6899, down 0.2328%, while the NZD/USD was trading at $0.6534, down 0.4857%.
US Retail Sales in Focus
While the US Dollar is under some pressure, the softness in its major rivals, the Euro and Pound, have kept in somewhat buoyed. Later today, US retail sales figures will be released and analysts are predicting a rise in the May numbers; the Retail Sales Control Group is expected to rise to 0.4% from 0.0% while the month-over-month Retail Sales should come in at 0.6%, from a -0.2% reading in April. Any disappointment in the figures are likely to put additional pressure on the greenback.