The Dollar Is Taking a Break from Its Recent Decline

<div><img width="1200" height="800" src="https://6ztkp25f.tinifycdn.com/wp-content/uploads/2021/05/The-U.S.-dollar-traded-close-to-a-three-month-high-why.S.-dollar-traded-close-to-a-three-month-high.jpg" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="dollar, Dólar americano foi negociado perto de alta de três meses" loading="lazy" srcset="https://6ztkp25f.tinifycdn.com/wp-content/uploads/2021/05/The-U.S.-dollar-traded-close-to-a-three-month-high-why.S.-dollar-traded-close-to-a-three-month-high.jpg 1200w, https://6ztkp25f.tinifycdn.com/wp-content/uploads/2021/05/The-U.S.-dollar-traded-close-to-a-three-month-high-why.S.-dollar-traded-close-to-a-three-month-high-300×200.jpg 300w, https://6ztkp25f.tinifycdn.com/wp-content/uploads/2021/05/The-U.S.-dollar-traded-close-to-a-three-month-high-why.S.-dollar-traded-close-to-a-three-month-high-1024×682.jpg 1024w, https://6ztkp25f.tinifycdn.com/wp-content/uploads/2021/05/The-U.S.-dollar-traded-close-to-a-three-month-high-why.S.-dollar-traded-close-to-a-three-month-high-768×512.jpg 768w" sizes="(max-width: 1200px) 100vw, 1200px" /></div><h1><span data-preserver-spaces="true">The Dollar Is Taking a Break from Its Recent Decline</span></h1>
<p><span data-preserver-spaces="true">On Thursday, </span><a href="https://www.financebrokerage.com/eurusd-and-gbpusd-use-the-weakness-of-the-dollar/" target="_blank" rel="noopener"><span data-preserver-spaces="true">the dollar</span></a><span data-preserver-spaces="true"> recovered its footing in Asia, halting the week’s slide as a drop-in tech and social media stocks dampened appetite for riskier currencies. Traders awaited central bank meetings in the United Kingdom and Europe.</span></p>
<p><span data-preserver-spaces="true">The riskier Australian and New Zealand dollars fell slightly during the Asian session. The pound fell, and the euro fell slightly to $1.1297. The yen fell a smidgeon to 114.51 per dollar.</span></p>
<p><span data-preserver-spaces="true">After the bell, shares of Meta, the company that owns Facebook, fell more than 20% as earnings, and the outlook fell short of expectations.</span></p>
<h2><span data-preserver-spaces="true">Currencies</span></h2>
<p><span data-preserver-spaces="true">Shares of Twitter and Spotify fell as well, and Nasdaq 100 futures fell 2%, weighing on demand for currencies such as the Australian dollar. The Australian dollar was last down 0.2 percent at $0.7120, just below resistance at $0.7180. The kiwi fell 0.1 percent to $0.6620. A holiday in China helped to lighten Asian trade.</span></p>
<p><span data-preserver-spaces="true">Policy decisions from the Bank of England (BoE) and European Central Bank (ECB) are due at 1200 GMT and 1245 GMT, respectively, with ECB President Christine Lagarde holding a press conference at 1330 GMT.</span></p>
<p><span data-preserver-spaces="true">A hawkish outcome could put pressure on the US dollar. The dollar index has returned to its 50-day moving average and was steady at 96.043 on Thursday.</span></p>
<p><span data-preserver-spaces="true">Markets have fully priced in a 25 basis point increase from the Bank of England, so the focus will likely shift to the outlook.</span></p>
<p><span data-preserver-spaces="true">Rising consumer prices and recent robust labor data have raised hopes to shift from describing inflation as transitory.</span></p>
<p><span data-preserver-spaces="true">The chances of the normalizing bank policy have increased, and Christine Lagarde may tell us that she cannot rule out a hike this year.</span></p>
<p><span data-preserver-spaces="true">It would bring the bank’s pricing closer to market and justify a long euro position.</span></p>
<p><a href="https://www.financebrokerage.com/an-attempt-to-recover-the-euro-and-the-pound/" target="_blank" rel="noopener"><span data-preserver-spaces="true">Sterling</span></a><span data-preserver-spaces="true"> fell 0.2 percent to $1.3547 and fell slightly to 83.36 pence per euro. Volatility gauges for the euro and sterling reached their highest year levels ahead of the meetings.</span></p>
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