Next, what you need to know on Thursday, May 1:
The US dollar (USD) continues to gain strength in front of its rivals early on Thursday, with the USD index progressing a maximum of two weeks above 100.00. The US economic calendar will include the employenger’s employment cuts and the ISM manufacturing PMI data for April, along with the initial weekly unemployment applications. European markets will remain closed on the occasion of the Labor Day holiday.
US dollar price this week
The lower table shows the percentage of the US dollar change (USD) compared to the main currencies this week. US dollar was the strongest currency in front of the euro.
| USD | EUR | GBP | JPY | CAD | Aud | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.57% | 0.13% | 0.52% | -0.41% | 0.16% | 0.54% | -0.19% | |
| EUR | -0.57% | -0.49% | -0.02% | -0.99% | -0.51% | -0.04% | -0.77% | |
| GBP | -0.13% | 0.49% | 0.44% | -0.49% | -0.04% | 0.45% | -0.28% | |
| JPY | -0.52% | 0.02% | -0.44% | -0.93% | -0.36% | -1.41% | -0.48% | |
| CAD | 0.41% | 0.99% | 0.49% | 0.93% | 0.45% | 0.95% | 0.23% | |
| Aud | -0.16% | 0.51% | 0.04% | 0.36% | -0.45% | 0.49% | -0.26% | |
| NZD | -0.54% | 0.04% | -0.45% | 1.41% | -0.95% | -0.49% | -0.73% | |
| CHF | 0.19% | 0.77% | 0.28% | 0.48% | -0.23% | 0.26% | 0.73% |
The heat map shows the percentage changes of the main currencies. The base currency is selected from the left column, while the contribution currency is selected in the upper row. For example, if you choose the US dollar of the left column and move along the horizontal line to the Japanese yen, the percentage change shown in the box will represent the USD (base)/JPY (quotation).
The Bank of Japan announced on Thursday that it kept unchanged the objective of the short-term interest rate in the range of 0.40%- 0.50%. At the press conference after the meeting, the governor of the BOJ, Kazuo Ueda, said that uncertainty about Japanese perspectives increased drastically due to US business policies. Ueda reiterated that rates will continue to increase if the economy and prices move in line with their projections. USD/JPY It preserves its bullish impulse and trades above 144.50 in the European morning, rising around 1% in the day.
The US Economic Analysis Office reported in its first estimate on Wednesday that the Gross Domestic Product (GDP) contracted at an annual rate of 0.3% in the first quarter. Other US USAs showed that the underlying Personal Consumption Price Index (PCE), the Federal Reserve’s preferred inflation indicator (FED), rose 2.6% year -on -year in March, coinciding with the market consensus. Meanwhile, US president Donald Trump said Wednesday that there was a very good probability that they reached an agreement with China. However, US commercial representative Jamieson Greer told journalists that there were no official conversations ongoing with China. Futures of US stock indexes rise between 0.5% and 1.4% in the European morning on Thursday after the main Wall Street rates registered small profits on Wednesday.
EUR/USD About 1,1300 is maintained downward and trades in the European session after registering losses for two consecutive days.
GBP/USD Fight to shake the bearish pressure and go back to the 1,3300 area early on Thursday, losing around 0.3% in the day.
Gold He lost almost 1% on Wednesday and closed below $ 3,300. The Xau/USD extends its weekly fall and deeply trades in negative territory below $ 3,250 to start the European session.
US dollar FAQS
The US dollar (USD) is the official currency of the United States of America, and the “de facto” currency of a significant number of other countries where it is in circulation along with local tickets. According to data from 2022, it is the most negotiated currency in the world, with more than 88% of all global currency change operations, which is equivalent to an average of 6.6 billion dollars in daily transactions. After World War II, the USD took over the pound sterling as a world reserve currency.
The most important individual factor that influences the value of the US dollar is monetary policy, which is determined by the Federal Reserve (FED). The Fed has two mandates: to achieve price stability (control inflation) and promote full employment. Its main tool to achieve these two objectives is to adjust interest rates. When prices rise too quickly and inflation exceeds the 2% objective set by the Fed, it rises the types, which favors the price of the dollar. When inflation falls below 2% or the unemployment rate is too high, the Fed can lower interest rates, which weighs on the dollar.
In extreme situations, the Federal Reserve can also print more dollars and promulgate quantitative flexibility (QE). The QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is an unconventional policy measure that is used when the credit has been exhausted because banks do not lend each other (for fear of the default of the counterparts). It is the last resort when it is unlikely that a simple decrease in interest rates will achieve the necessary result. It was the weapon chosen by the Fed to combat the contraction of the credit that occurred during the great financial crisis of 2008. It is that the Fed prints more dollars and uses them to buy bonds of the US government, mainly of financial institutions. Which usually leads to a weakening of the US dollar.
The quantitative hardening (QT) is the reverse process for which the Federal Reserve stops buying bonds from financial institutions and does not reinvote the capital of the wallet values ​​that overcome in new purchases. It is usually positive for the US dollar.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
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