Thursday, 10 Feb 2011

Dollar Continues to Strengthen versus Counterparts

The dollar strengthened versus all of its 16 major counterparts in today's Asian trading, rising near a two week high versus the yen, ahead of a report today that is expected to show U.S unemployment claims declined. The slowly improving job market as well as signs consumer confidence is on a rise boosted optimism about recovery of the world's largest economy.

The EUR/USD pair dropped over 100 pips from yesterday's high to currently trade at $1.3633, from $1.3733. The dollar gained to 82.70 yen from 82.36 in New York yesterday.

Later today, traders should follow Britain's Asset Purchase Facility and MPC Rate Statement. The Bank of England is expected to leave its key lending rate unchanged at a record low 0.5%. Another major indicator to be released today is the U.S unemployment claims, which is expected to show another decline; potentially boosting the USD even further if the outcome is as expected.