Following the signs of the U.S. Federal Reserve that U.S. interest rates may be increased earlier than expected, the U.S. dollar received a significant boost in trade last night and early morning. Today, a complete set of news events dollar will probably determine the direction of the dollar goes for the rest of the week.
U.S. Federal Reserve (Fed) left interest rates unchanged after its policy meeting on Wednesday, but the general tone of optimism left the door open to an increase in the near future. The dollar reacted to the news that has risen to around 6 months against the euro. The pair traded as low as 1.3994 on Wednesday, before recovering to its current level of 1.4020.
Today, the news cycle will be dominated by currency developments in the dollar. Core Durable Goods Orders, the latest unemployment claims report and the Senate vote to reappoint Ben Bernanke as Fed chairman, are likely to create heavy market volatility.
Analysts are generally optimistic about the news dollar today, with unemployment expected to drop and Core Durable Goods Orders in positive territory. Traders expect the dollar to make more profit now provides news comes in as predicted. This may be especially true of the euro, which is still recovering from the concerns of the Greek debt.