- The US dollar marks marginally in front of the Chilean peso, currently quoting in 942.42.
- The dollar index (DXY) loses 0.50% daily, reaching minimum of May 7 at 99.40.
- Copper prices advance 0.40% on Wednesday, reaching maximum of May 14 in $ 4,6579 per pound.
- The focus of the operators will be in the publication of the PMI´s manufacturing, services and integrated of the United States Global, to be published tomorrow.
The USD/CLP established a maximum of the day at 942.89, finding vendors that dragged parity to a minimum of the day in 942.23. At the moment, the USD/CLP falls 0.03%, remaining within the range of the previous session at 942.42.
The Chilean weight operates without significant changes waiting for key economic data from the United States
The dollar index (DXY) records a fall of 0.50% today, visiting minimums of two weeks not seen since May 7 in 99.40, signing its third consecutive day upwards.
On the other hand, copper prices rebound 0.40% in the day, reaching May 14 at $ 4,6579 per pound, spinning three consecutive sessions with profits.
In this scenario, the Chilean weight is listed without significant changes, while the USD/CLP decoced 0.03% on Wednesday, operating when writing about 942.42.
The attention of investors will be in the publication of the manufacturing PMIs, as well as the services and integrated of the US S&P global to make known on May 22.
Technical levels in the USD/CLP
The USD/CLP established a short -term resistance given by the maximum of April 30 in 961.65. The following important resistance is at 1,007.73, maximum of April 9. Down, the immediate support is at 928.21, minimum of May 9.
USD/CLP daily graphics
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.
