The Dollar weakened against every single G10 currency on Thursday after terrible US economic data fuelled concerns over the health of the largest economy in the world.
The US Dollar has been making sharp moves as the only market trading in the green in the current economic crisis. On the US Dollar Index ( DXY ), the greenback has been living up to its name by making steady gains since the 9th of March, rising from below 95 points to above 101, the highest it has been since 2017.
This gain in the USD has been due to the fact that investors are now pulling out of other markets due to their extreme volatility , and withdrawing it back to liquid cash. The global economic uncertainty has caused the markets to fall with no bottom in sight.
The Trump administration recently announced a stimulus plan of $1 trillion, the largest of any country, as a response to the current chaos in the markets. As part of this plan, the government said they were talking about sending cheques of up to $2000 per month in order to offset loss of income, as well as being able to defer up to $1 million in income taxes.
Nearly 3.3 million Americans applied for unemployment benefits last week which was more than triple the previous record set in 1982 amid the widespread economic shutdown caused by the pandemic. These figures are certainly a shocking reflecting of how badly the coronavirus has hit theeconomy with the pace of layoffs expected to jump as the United States sinks into a recession. Dollar weakness could become a short term theme if economic data continues to paint a gloomy picture, despite the efforts of the Federal Reserve and Senate to promote stability.
Looking at the technical picture, the Dollar Index is under intense pressure on the daily charts with prices trading around 99.90. A solid daily close below this level could open a path towards 99.00
The US Dollar has been making sharp moves as the only market trading in the green in the current economic crisis. On the US Dollar Index ( DXY ), the greenback has been living up to its name by making steady gains since the 9th of March, rising from below 95 points to above 101, the highest it has been since 2017.
This gain in the USD has been due to the fact that investors are now pulling out of other markets due to their extreme volatility , and withdrawing it back to liquid cash. The global economic uncertainty has caused the markets to fall with no bottom in sight.
The Trump administration recently announced a stimulus plan of $1 trillion, the largest of any country, as a response to the current chaos in the markets. As part of this plan, the government said they were talking about sending cheques of up to $2000 per month in order to offset loss of income, as well as being able to defer up to $1 million in income taxes.
Nearly 3.3 million Americans applied for unemployment benefits last week which was more than triple the previous record set in 1982 amid the widespread economic shutdown caused by the pandemic. These figures are certainly a shocking reflecting of how badly the coronavirus has hit theeconomy with the pace of layoffs expected to jump as the United States sinks into a recession. Dollar weakness could become a short term theme if economic data continues to paint a gloomy picture, despite the efforts of the Federal Reserve and Senate to promote stability.
Looking at the technical picture, the Dollar Index is under intense pressure on the daily charts with prices trading around 99.90. A solid daily close below this level could open a path towards 99.00