US Dollar under pressure as China data sparks risk-on

US Dollar is under pressure in risk-on markets.
Euro rallies to a one-week high and China is bouncing back.

Ross J Burland FXStreet

The US Dollar is broadly weaker to kick off March after posting a 3% gain for February while risk appetite roared back to life on the evidence of a stronger-than-expected recovery in the Chinese economy.

At the time of writing, DXY, an index that measures the greenback vs. a basket of currencies, is losing 0.36% after falling from a high of 105.09 and reaching a low of 104.09 on the day so far, backing down from its first monthly gain after a four-month losing streak.

A bunch of strong U.S. economic data in recent weeks has raised market expectations that the Federal Reserve has further to go in hiking rates. Futures pricing continues to edge higher, with a peak rate climbing on Wednesday to 5.45% in the fed funds by September. However, China's Non-manufacturing activity grew at a faster pace in February, while the Caixin/S&P Global manufacturing PMI reading for last month likewise surpassed. The offshore yuan jumped 1.3% to 6.8683 per dollar, set for its largest one-day gain since late November.

The US Dollar has also struggled to hold up vs. the Pound and Euro. For instance, the pound surged 1% at the start of the week after Britain struck a post-Brexit Northern Ireland trade deal with the European Union. However, the euro, which is the majority of the basket in the DXY, is firmer due to the latest German inflation data exceeding expectations, supporting the case for the European Central Bank to raise interest rates further. The data comes ahead of key eurozone inflation data on Thursday while the Single Currency rises to a one-week high of 1.0691.

Dollar Index Spot

Overview
Today last price	104.53
Today Daily Change	-0.46
Today Daily Change %	-0.44
Today daily open	104.99

Trends
Daily SMA20	103.68
Daily SMA50	103.35
Daily SMA100	105.14
Daily SMA200	106.83

Levels
Previous Daily High	105
Previous Daily Low	104.41
Previous Weekly High	105.32
Previous Weekly Low	103.76
Previous Monthly High	105.36
Previous Monthly Low	100.81
Daily Fibonacci 38.2%	104.78
Daily Fibonacci 61.8%	104.64
Daily Pivot Point S1	104.6
Daily Pivot Point S2	104.21
Daily Pivot Point S3	104.01
Daily Pivot Point R1	105.19
Daily Pivot Point R2	105.39
Daily Pivot Point R3	105.78

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

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