US dollar is lower across the board today, following the latest economic data release. The economy continues to show solid improvement, and that should be encouraging a degree of risk appetite. However, other forces, like the possibility of a government shutdown and the possibility of the taper being held off until next year, seem to be weighing on the greenback instead.
There’s a lot of uncertainty in the markets right now, but it’s not the sort of uncertainty that leads Forex traders to choose the US dollar over other currencies. Instead, it’s the uncertainty surrounding the fact that US Congress can’t seem to come to an agreement that avoids a government shutdown. On top of that, there’s a debt ceiling debate that could lead to technical default.
Also not helping the US dollar are comments from a Federal Reserve official that seem to indicate that the asset taper could be put off until next year. With all of this political uncertainty, even the recent positive economic news pales. Consumer spending rose 0.3 per cent in August, but that isn’t helping much as concerns override the current economic gains.
At 13:43 GMT EUR/USD is up to 1.3556 from the open at 1.3489. GBP/USD is up to 1.6109 from the open at 1.6042. USD/JPY is down to 98.3295 from the open at 98.9865.
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