Dollar Hovers Close To Lowest Levels Of The Year As Traders Focus Inflation

Dollar Hovers Close To Lowest Levels Of The Year As Traders Focus Inflation

12 May 2021 07:45 AM
 

The USDINR NDF is currently trading at 73.39/41.

The U.S. currency hovered close to its lowest levels of the year today as market participants hung on to bets that the Fed would remain steadfast in its easy policy settings ahead of data expected to show a sharp rise in annual U.S. inflation.

The dollar hit its weakest in two months against the euro overnight, following a strong European growth survey, and it traded just above that level at $1.2140 early in Asia. The yen dropped slightly to 108.79 per dollar.

Sentiment aided the dollar index a fraction higher to 90.278 as selling pressure persisted in stock markets, but that still leaves it just above key support around 89.677 and 89.206. Sterling hung on to recent gains to trade at $1.4118.

The SGX Nifty was trading 15.00 points or 0.10 % lower at 14,835.00, indicating a flat-to-negative start for the broader index in India.

The U.S. currency is also being weighed down by the improving global growth outlook, which tends to draw investors' cash to emerging markets, and by big and growing U.S. trade and current account deficits which also send dollars abroad.

Brent crude futures climbed 23 cents, or 0.3%, to settle at US$68.55 a barrel while U.S. West Texas Intermediate crude futures rose 36 cents, or 0.6%, to end the session at $65.28.