Dollar ends higher on Fed uncertainty: Sept 29, 2016

Market Review - 28/09/2016  22:58GMT  

Dollar ends higher on FED uncertainty

The greenback ended the day little higher against majority of its peers on Wednesday as uncertainty over the Federal Reserve's rate hike path increased. 

Versus the Japanese yen, the greenback found renewed buying at 100.26 ahead of Asian open and gained to 100.71 ahead of European open, then to 100.82 in European morning. However, dollar pared its gains and retreated to 100.46 in New York morning. 

The single currency remained under pressure in Asia and fell briefly but sharply to session low at 1.1182 in early European morning. Later, euro pared its losses and rallied to an intra-day high at 1.1237 at New York open before retreating again, however, renewed selling there sent the pair lower and euro retreated strongly to 1.1187 in New York morning. 

Although the British pound weakened to 1.2991 in Asian morning, price rebounded to 1.3033 in Europe before falling to session low at 1.2980 after comments from BoE's Shafik. Later, cable pared its losses and rose to 1.3033 at New York open before retreating again in tandem with euro. 

Bank of England Deputy Governor Minouche Shafik said she expected the central bank would need to pump more stimulus into Britain's economy "at some point" as it adjusts to the shock of the vote to leave the European Union. 

In other news, ECB's Draghi said 'ECB's Draghi said 'what we need now is to allow our measures to develop their full impact; the ECB does not operate in a vacuum: other economic policies are essential to complement our monetary policy; other policy areas must contribute much more decisively; without them there will be no strong and sustainable recovery. these other policies are a precondition for interest rates to rise again; low interest rates for a long period might carry the risk of overvaluation in asset markets; the ECB's monetary policy is not the main factor for the low profitability of banks; at the moment we are not seeing any overheating in the euro area or the German economy; low interest rates for a long period might carry the risk of overvaluation in asset mkt as a result of search for yield.' 

On the data front, total durable goods orders, which include transportation items, remained unchanged last month, the Commerce Department said, compared to economists' expectations for an decline of 1.4%. July's orders were revised down to show an increase of 3.6% from a previously reported 4.4% gain. 

Data to be released on Thursday: 

Japan retail trade, Germany unemployment rate, unemployment change, CPI, HICP, U.K. mortgage approvals, Eurozone business climate, economic sentiment, industrial sentiment, service sentiment, consumer confidence, consumer inflation expectation, selling price expectation, U.S. GDP, personal consumption expenditures, good trade balance, wholesale inventories, retail inventories, initial jobless claims and pending home sales.