- The US dollar falls terrain against Chilean peso, oscillating within the previous session range at 964.95.
- The dollar index (DXY) goes back 0.41% today, reaching minimum of July 16 at 98.11.
- The feeling of the consumer of the University of Michigan increases to 61.8 in July, improving market expectations.
- The price of copper rebuops 1.45% on Friday, operating at the moment over $ 5,5759 per pound.
The USD/CLP established a maximum of the day at 964.95, attracting vendors that dragged parity to a daily minimum at 962.08. At the moment, the USD/CLP decoced 0.11% in the day, operating over 964.95.
Chilean weight gains traction in the midst of copper prices rebound
Today it was announced that the preliminary feeling of the consumer’s feeling of the University of Michigan increased to 61.8 points, located above the 61.5 expected and 60.7 observed in the previous month.
At the same time, the United States Census Office announced the increase in construction permits from June to 1,397 million, slightly greater than the 1.39 already planned 1,394 registered in May.
After this news, the dollar index (DXY) falls 0.41% on Friday, reaching minimum of July 16 in 98.11.
On the other hand, copper prices earn 1.45% today, reaching maximums of July 15 in $ 5,6062 per pound, ending with a streak of five consecutive sessions down.
The Chilean weight is listed up for the second consecutive day, while the USD/CLP falls 0.11% in the last session of the week, operating at the time of writing at 964.95.
Technical levels in the USD/CLP
The USD/CLP reacted down from a key resistance at 972.98, maximum of July 14. Downwards, the important support is located at 915.57, a pivot point of March 19.
USD/CLP daily graphics
US Dollar – Frequently Questions
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.
