USD started the week with declines after came after statement of member of the Monetary Policy Committee of the US Federal Reserve, Lael Brainard. She called for more cautious about raising rates, which tipped the scales more towards abstinence by central bankers. This in turn reduce the likelihood of tightening monetary policy of the US economy. Brainard’s speech was in contrast with the statement of the president of the Fed’s Eric Rosengren on Friday, which plunged stock markets and increase perceptions of higher interest rates on September 21.
After comments Brainard the US indexes were on green territory, as Dow Jones Industrial Average rose by 1.32%, the S&P 500 added 1.47% to its value, while USD halted its appreciation. The US currency against CAD, which was also supported by the Green Session of oil. The USD retreated against the GBP, which accumulates expected news Thursday on interest rates in UK. The expectations that the UK will leave rates unchanged from 0.25% gave impetus to GBP. Today will be announced important data for the country as it will be the consumer price index.
During the Asian session today was announced data on industrial production in China, which decreased tension on the robustness of the Chinese economy, as it has realized growth of 6.3% yoy. However, indications of reduction of foreign exchange reserves of China and the unexpected increase in imports keep attention on the CNY despite the positive data today. These, in combination with retail sales supported the AUD, which recorded growth against the JPY.
The reversal of sentiment regarding interest rates in USA could undermine the position of the USD even more, having dashed expectations can multiply the negative effect. Possibly refraining from action central bankers next week could push quotations greenback down, and gave the green light indexes. After the speech of Brainard, the sharp rise in bond yields last week calmed and auctions indexes were stopped.