The U.S. dollar reportedly increased on Friday. That position halted the recent downward trend as Treasury yields pushed higher. However, its movements are still small ahead of the release of the latest US employment data which is so important.
It cannot be denied that NFP data that includes employment information is always awaited by market participants. That release will greatly affect the trading of currencies and other important commodities in global markets. For example is gold and oil.
Meanwhile, in the global market is known that the Dollar ndeks tracking the greenback against six other currencies reported a decline of 0.1% at 89.812. That means it has bounced to a nearly three-year low and follows a drop of almost 7% in 2020.
Currency Movement Updates
What about the state of other currencies? From the data it could be known that the USD/JPY pair was up 0.1% at 103.90. Meanwhile, the EUR/USD position actually decreased by 0.1% to 1.2262,. Previously, the pair managed to reach a nearly three-year high of 1.2346.
Elsewhere, GBP/USD also increased slightly by 0.1% to 1.3579. Meanwhile, the risk-sensitive AUD/USD pair was up 0.2% at 0.7783. The development of the currency pair may still undergo changes in the future based on some conditions.
The interesting thing is coming from the greenback. The greenback has been slumping for months. One of the main causes is the hope of global recovery, and is supported by the introduction of the Covid-19 vaccine. Nowadays there are already several vaccines with high effectiveness.
Some countries have already started bringing vaccines to their countries. In fact, there have been some who started injecting against the community. Hopefully later this effort will be able to provide the best benefits and end this coronavirus pandemic.
Impact Democrats Win Senate
The current greenback is also caused by very negative US real rates. Many market participants regret this and hope that things will be better. It is undeniable that the results of the decision of a senate hearing in Georgia some time ago also brought influence.
This week's overall trend in global markets was heavily influenced by the outcome of the Democratic Party legitimately winning effective control of the Senate. That would give President-elect Joe Biden scope to provide more stimulus in the future.
It said the trend had been tried on Friday with the 10-year Treasury benchmark reaching 1% earlier this week. It happened for the first time since March. More precisely is in the midst of the political turmoil that previously occurred in Washington DC.
Some said that "expectations” regarding the launch of the vaccine will allow the economy to reopen in the second quarter of this year. This means that if there is a correction in the dollar trend, then it will be quite superficial.
Predicted Currency Movements
The nalysts from the ING now estimate that the EUR/USD and USD/JPY currency pairs will end the year with close to some levels. The number levels are 1.30 and 100 for each. It does make sense so far.
Trading was in a tight state on Friday ahead of the much-highlighted monthly nonfarm payrolls report. Market participants are looking for clues about whether more stimulus will be needed to keep the job recovery going.
December figures are expected to show a rise of 71,000 jobs. It mans that the thing will be much lower than the 245,000 jobs added on Nov. Earlier this week, a payrolls report by ADP said private businesses slashed 123,000 jobs on Dec.
That condition is worse than what a lot of economs expected. The situation is not stable yet and the data may show it all. The right efforts need to be done in the future to make the condition is better than before.
