U.S. Greenback Giant as Economy Stands Strong
The greenback surged to its strongest level of 2020 Monday after last week’s run of data showed the U.S. economy is holding up properly, while China’s yuan shortly struck a new six-month high.
Mostly, nonetheless, it was another quiet beginning to the week for currencies, with forex volatility near all-time lows and little in crucial economic data.
Traders are focused on central bank meetings in Japan and the Thursday European Central Bank meeting.
Trading volumes were light as Lunar New Year approaches in China and with U.S markets closed for Martin Luther King day Monday.
Figures Friday showed U.S. homebuilding soared to a 13-year high in December.
Retail sales further hiked, and a gauge of producing activity rebounded to its highest in eight months.
The strength in the U.S. economy marks its relative outperformance against the eurozone. However, recent data point to a bottoming out in the European economy, in addition to a recovery in China.
The euro has failed to learn a lot from the extra positive noises, nevertheless, and the euro or greenback exchange rate is firmly stuck inside a tight trading range.
The greenback inched up 0.1% in opposition to leading currencies, with the index soaring to as high as 97.727, its most active since December 24.
China’s offshore yuan increased to as high as 6.8451, a new six-month high before the rally fizzled. It buoyed at 6.8715, slightly down.
China Friday posted its slowest annual growth figure in virtually three decades, although December data confirmed revived business confidence and quickening manufacturing output.