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Weakening Of FOREX Foreign Exchange Dollar

With all the recent issues that the US Government is facing in Iran, it is not at all surprising that the FOREX foreign exchange dollar weakend quite a bit. After a tumble on Monday, the foreign exchange market saw a steadying in the dollar on Tuesday. Hopefully, this steadying will be followed with a bit of a rise in the FOREX foreign exchange with in the following weeks. The U.S. currency fell around 1 percent against the euro and 0.8 percent versus the yen on Monday, despite dollar-positive data that showed more than enough capital flowed into the United States in February to offset its huge trade deficit.

The market`s attention was turning to the minutes of the Fed`s March meeting due later in the session for clues about whether the central bank would keep raising short-term interest rates beyond a widely expected increase in May, traders said. The U.S. producer price index for March is also due later in the FOREX foreign exchange session, followed by the consumer price index on Wednesday. Takeda, currency strategist at Bank of Tokyo-Mitsubishi UFJ, said the U.S. currency`s weakness over the past few sessions, which had been thinned by Easter holidays in markets outside of Japan, didn`t point to a shift away from a broader dollar-positive trend.

The dollar hasn`t breached resistance at 119 yen but it hasn`t fallen below mid-117 yen either, leaving the currency shuffling within a narrow range. Growing geopolitical tensions over Iran`s nuclear programme helped to diminish demand for the dollar and pushed gold prices to a new 25-year high on Monday. The metal, often favoured as a safe-haven investment, was also supported by a rise in U.S. oil crude prices, which leapt to $70 a barrel for the first time in seven and a half months on Monday and was poised to hit a record high near $71.