US dollar remains depressed on Wednesday losing grounds vs the majors ahead of the Federal Reserve monetary decision.
The US Dollar index dropped to 88.81 today morning (last-week bottom – 88.25). The American currency keeps weakening against other main currencies – by now the index has lost 3.0% in total over the past month.
The greenback has started slackening as investors are gradually losing interest in it as the source of profit. With the anticipated monetary tightening outside the USA, it appears that the gap between the interest rates of the Federal Reserve and central banks in other countries will get narrower. An extra pressure came from a non-specific speech of the US President Donald Trump. In particular. Donald Trump in his State of Union called both parties of the Congress to eventually agree on infrastructure development and the immigration issue. In his message, he encouraged to make decisions that could help to generate $1.5 trillion investments in the infrastructure projects in the USA. However, details of the projects are yet to be disclosed.
Still, investors are careful now considering this-week big events, including interest rate decision by Federal Reserve and January labor report.
The euro to US dollar reached 1.2449, which is close to the all-time record at 1.2537 recorded last week. The European currency has posted a 3.5% rebound vs the greenback in January.
Besides, US dollar has decreased in the USD-JPY pair to 108.68 (record bottom – 108.27). The sterling has progressed to 1.4161 against the US dollar.