USD Not Giving Up Ground to Its Rivals in Monday Assessment

Starting the week off resilient against other currencies, the US dollar holds its place on the global market.

For Monday, February 5^th, the USD Index is up 0.9% from five days ago. That index is a measure of the dollar’s strength against other currencies. The index climbed slightly higher after Federal Reserve chairman Jerome Powell gave hawkish remarks about interest rates and said they would not be cut for now.

While the US dollar climbed on Friday, it is now holding steady against most of the competing currencies. It is up 0.01% against the Euro and 0.1 against the British pound. The dollar is also up 0.07% to the franc and is flat with the Canadian dollar. However, when paired against the Japanese yen and the Australian dollar, the US dollar is down 0.13% and 0.16% respectively.

This demonstrates the dollar’s stability and strength but also shows that there is fluctuating interest in investing in the unit right now. Investors are simply not sure if the dollar will keep its strength against many of these currencies. The US jobs report and the Federal Reserve’s announcement will help the dollar for now, as both of these were at least somewhat positive and worked in the dollar’s favor.

What’s Next for the Dollar?

That jobs report shows that there were 353,000 new jobs recorded for January in the US, which was far above what economists expected would be reported (closer to the 180,000 range). If interest rates do get cut in November, we will likely see the global markets respond with movement against the US dollar. Cuts could come sooner than that, though, according to Powell, if inflation decreases substantially or labor market weaknesses start to drop.

The current numbers of the US dollar are its highest in three months when paired against the Euro and pound. If that kind of progress is the focus of financial reports, the dollar has the potential to move much higher.