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Dollar Index Takes A Breather Near Two-Week Highs; FOMC Eyed

Published on Jul 25, 2023 11:50

The dollar index is seen taking a breather during early Asian trades on Tuesday, holding near two-week highs attained in the previous session. The index that measures the greenback against a basket of currencies is staying afloat 101 mark, off recent 15 month lows but marginally lower on the day. Benchmark treasury yields are also up 0.7% at 3.88%. Federal FOMC meeting outcome due this week is eagerly awaited for further clarity on direction. Meanwhile, rate decision from the European Central Bank (ECB) on Thursday and the Bank of Japan (BOJ) on Friday is also expected to provide some insights on stance of dollar going forward. Data overnight showed S&P Global US Manufacturing PMI increased to 49 in July of 2023 from a six-month low of 46.3 in June while Services PMI dropped to 52.4 in July 2023, down from 54.4 the previous month. The Composite PMI declined to 52.0 in July 2023, down from 53.2 the previous month. From the dollar basket, EURUSD is staying steady at $1.1105 while GBPUSD is up 0.09% at $1.2840. Meanwhile, the yuan is holding at a one-week high on hopes of a policy support by Chinese authorities. USDCNY is down half a percent at 7.14.

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