Currencies remain steady on Monday trading

Published: 26 Aug at 9 AM Tags: Euro, Dollar,

The US dollar may be set for a rebound as it remains steady against a basket of other currencies. Although there was a bit of a wobble against the yen earlier that saw the greenback drop as low as 98.17 yen, it soon recovered to 98.72 yen. In New York the dollar is holding firm against the euro at $1.3381. The single currency has been creeping up against the dollar in recent weeks, but analysts suspect that it will not breach $1.3370 after last week’s high of $1.3452.

The Swiss franc and the pound are also competing with the strengthening US currency. The dollar index is up slightly at 81.379. According to the Commodities Futures Trading Commission, the greenback is gaining favour with speculators for the fifth week in a row.

However, the dollar is under pressure following Friday’s publication of new-homes figures that indicated a 13.4 per cent slide in July. This is the lowest figure for the market in nine months. But existing homes figures are apparently significantly on the up.

The news has added to speculation about whether the Federal Reserve will go ahead with plans to scale back its easy money programme. Many analysts believe that the central bank will begin curbing quantitative easing within weeks.

All eyes are now on the August payroll data due to be released on 6 September.