Positive data provides little support for USD

In recent months, the USD has traded in a tight range against both the Yen and the Euro. This has occurred despite the release of positive economic data and an interest rate differential which increasingly favors the USD. Currency traders have grown disheartened over the repeated failure of the USD to hold onto gains following positive economic announcements. That the economic calendar appears conspicuously empty in the next week is bad sign for the USD, argue traders, because the USD won’t have anything to derive support from. The Wall Street Journal reports:

Analysts suspect that after last week, when the dollar failed to hold onto gains despite economic data that was largely supportive, it is unlikely the dollar will continue its upward trend.

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