The USD weakened from the beginning of the trading session on Tuesday, falling back to its lowest level for nearly two months, as global investors awaited a series of important US economic data. In particular, the November jobs report was delayed earlier.
The USD Index, which measures the strength of the greenback against a basket of six major currencies, fell 0.2% to 98.261 points, approaching its lowest level since October 17.
The US Bureau of Labor Statistics (BLS) is expected to release a comprehensive October and November jobs report, after data collection was disrupted by a six-week government shutdown. In addition, the market will also receive a series of preliminary indicators on the manufacturing sector, contributing to completing the US economic picture in the final period of the year.
Mr. Paul Mackel - Head of Global Foreign Exchange Research at HSBC - said that upcoming employment figures will help clarify the situation of the US labor market during the government's closure, while noting that the recent policy message of the Fed shows that the USD has not really escaped the pressure of weakness.
According to CME Group's FedWatch tool, the market is currently pricing in a 75.6% chance of the Fed keeping interest rates unchanged at the January 28 meeting, unchanged from the previous session.
Not only US data, the global currency market this week was also affected by a series of policy decisions by major central banks.
The Bank of Japan (BoJ) is expected to raise interest rates by 25 basis points, bringing interest rates to 0.75%, while the Bank of England (BoE) may cut interest rates at the same level, down to 3.75%.
In Europe, the European Central Bank (ECB) is likely to keep its monetary policy unchanged, similar to Sweden's Riksbank and Norway's Norges Bank.
In the foreign exchange market, the USD decreased by 0.1% against the yen, down to 155.07 Yen/USD, as investors awaited the BoJ's policy decision at the weekend. The Euro moved sideways around $1.17535, while the British fund was flat at $1.3376.
The Australian dollar rose slightly by 0.1% to $0.66445, although a new survey showed consumer confidence declined in December after recovering last month. The New Zealand dollar also gained 0.1%, to 0.5788 USD.
The fact that the Australian and New Zealand central banks have signaled not to continue cutting interest rates is creating a certain boost for currencies in this region.
In the cryptocurrency market, Bitcoin increased 0.2% to 86,420.67 USD, while ether increased 0.6% to 2,963.54 USD, after the previous adjustment session.
