USD rose on Tuesday against a basket of global currencies to resume its gains, which were temporarily suspended yesterday as part of profit taking. The rise comes as US bond yields recover for the next 10 years. In October, and the USD currency is about to make the second monthly gain in a row, due to strong prospects for raising US interest rates in December, and support the hopes of the success of the administration of President Donald Trump in the adoption of tax reforms Wide promote economic growth in the country.
The dollar index rose by 0.1% at 12.15 GMT, trading at 94.45 points, the opening level at 94.37 points, the highest at 94.55 and the lowest at 94.34.
The index ended yesterday’s trading down 0.4%, the first loss in three days, by correction and profit taking, after recording on Friday the highest level in three months 95.05 points.
US 10 year bond yields rose 2 basis points to 2.38%, recovering from previous day’s losses. Last week’s yields were up seven months high, supported by interest rates and speculation about the new Federal Reserve Chairman.
Investors are looking forward to important data from the united states on the Chicago industrial sector and consumer confidence this month. The positive data will expand the USD’s rally against most currencies.
Chicago Industrial Average is forecast to reach 60.2 points in October from 65.2 in September and consumer confidence CBI October consumer sentiment index is expected to rise 121.1 points from 119.8 points in September.
For the month of October, ending the day, the dollar index rose 1.7%, on the verge of achieving the second monthly gain in a row, due to strong prospects for the Fed to raise interest rates for a third time during the December meeting, The success of the united states President Donald Trump’s administration in endorsing sweeping tax reforms that boost the country’s economic growth.
Federal Reserve’s Open Market Committee will begin its regular meeting on Friday to discuss monetary policy appropriate to developments in the united states economy and will issue its decisions on Wednesday, amid expectations that interest rates will remain unchanged at 1.25%.
The Committee noted at the previous meeting that it still expects another increase in interest rates by the end of the year, despite the weak levels of inflation in the country.
Meanwhile, the White House announced on Monday that united states President Donald Trump would announce his decision to elect the new Federal Reserve chairman next Thursday.
According to the latest news, Trump tends to choose Federal Reserve member Jerome Powell as the new Federal Reserve chairman for a term extending until 2022. Powell is seen as more cautious about tightening monetary policy than other contenders, especially with economics professor John Taylor, Competitors on the post are currently with Powell.