The U.S. dollar advanced against the other major currencies in European deals on Friday, amid bets that the recent post-Fed sell off was overdone, and traders now focus on consumer sentiment data later in the day.
The University of Michigan releases preliminary consumer sentiment index for March at 10:00 am ET. The consumer sentiment is expected to advance to 92.2 points from a reading of 91.7 recorded in February.
The Federal Reserve on Wednesday indicated that the US economy is not immune from weakness from across globe, although it hinted at slower pace of rate hikes this year owing to moderate growth and strong labor market.
European shares rose amid firm commodity prices and a weaker euro, which paused rally after soft German inflation and the European Central Bank’s executive board member Peter Paret remarks that further rate reduction remains possible.
The greenback held steady against most major rivals in Asian deals.
In European trading, the greenback appreciated to 1.1256 against the euro, up by 0.7 percent from a low of 1.1337 hit at 9:30 pm ET. If the greenback extends rise, 1.11 is likely seen as the next resistance level.
Data from Destatis showed that Germany’s producer prices declined at a faster-than-expected pace in February.
The producer price index fell 3.0 percent year-over-year in February, exceeding economists’ expectations for a 2.6 percent decrease.
The greenback edged up to 1.4410 against the pound, compared to 1.4477 hit late New York Thursday. On the upside, the greenback may find resistance around the 1.43 region.
The greenback climbed to 0.9717 against the Swiss franc, off its early low of 0.9654. The greenback is seen finding resistance near the 0.98 mark.
The greenback advanced to 0.6785 against the kiwi and 0.7612 against the aussie, from its previous low of 3-month low of 0.6874 and near 9-month low of 0.7680,respectively. The greenback is likely to challenge resistance around 0.66 against the kiwi and 0.75 against the aussie.
The greenback held steady against the yen, following an advance to 111.58 at 1:45 am ET. The pair ended yesterday’s trading at 111.37.
Minutes from the Bank of Japan’s recent meeting showed that members of the monetary policy board implemented a policy of negative interest rates in order to spur the fight against deflation.
The members added that downside risks included low oil prices, plus weakness from commodity exporters.
Looking ahead, Canada retail sales data for January and CPI data for February, and U.S. Baker Hughes rig count data are slated for release in the New York session.
At 9:00 am ET, Federal Reserve Bank of New York President William Dudley and Fed Boston President Eric Rosengren will deliver opening remarks at the conference on bank supervision, in New York.
At 2:00 pm ET, Federal Reserve Bank of St. Louis President James Bullard is expected to speak at the International Research Forum on Monetary Policy in Frankfurt.
The material has been provided by InstaForex Company – www.instaforex.com