Forex Today: Lack of fresh news played against the greenback
|What you need to know on Thursday, May 21st:
The American dollar remained under selling pressure, losing ground against most major rivals. The EUR/USD pair flirted with 1.1000, holding just below it ahead of the Asian opening. There were no significant macroeconomic releases, neither coronavirus-related news that could trigger some action.
The greenback’s decline was related to the positive performance of global indexes. Stocks advanced, helped by encouraging earnings reports.
The US Federal Reserve released the Minutes of its latest meeting. Policymakers discussed a more explicit forward guidance and agreed that rates will stay low for longer. There was no discussion on negative rates.
The Pound was among the weakest, with GBP/USD settling around 1.2220. Inflation in the UK fell to its lowest in more than three years in April, triggering speculation that the Bank of England could deepen its stimulus measures, including pushing interest rates into negative territory. Also, BOE’s Governor Bailey said that he had changed his position on negative rates “a bit.”
US Treasury yields edged lower, weighed by the demand for 20-year Treasuries. The USD/JPY trimmed its recent gains and returned to 107.30 region.
Commodity-linked currencies retain their positive tone, helped by equities and crude oil prices, which also advanced. Gold spent the day in consolidative mode around $1,750.00 a troy ounce.
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