The U.S. dollar strengthened against the other major currencies in the early European session on Monday, as traders await the Federal Reserve chair Janet Yellen’s testimony to U.S. lawmakers, due tomorrow.
Yellen’s testimony on the Semiannual Monetary Policy Report before the Senate Banking Committee in Washington is due on Tuesday.
Traders closely watch the testimony to get fresh clues on when the Federal Reserve will start to lift interest rates.
Althouh the Fed’s January meeting minutes released on last week showed that the policy makers are in no rush to increase rates, investors continue to position for higher U.S. rates at some point this year.
Greece reached a deal with its eurozone creditors to extend its bailout agreement, although it is required to present the first list of reform measures to the eurozone later today.
In the Asian session, the U.S. dollar held steady against its major rivals.
In the early European trading today, the U.S. dollar rose to a 5-day high of 119.28 against the yen, from an early low of 118.87. The greenback is likely to find resistance around the 120.50 area.
The greenback edged up to 1.1332 against the euro, 0.9484 against the Swiss franc and 1.5374 against the pound , from early lows of 1.1395, 0.9386 and 1.5395, respectively. If the greenback extends its uptrend, it is likey to find resistance around 1.12 against the euro, 1.02 against the franc and 1.51 against the pound.
Against the New Zealand and the Canadian dollars, the greenback appreciated to a 6-day high of 0.7496 and near a 2-week high of 1.2578 from early lows of 0.7529 and 1.2522, respectively. The greenback may test resistance near 0.72 against the kiwi and 1.28 against the loonie.
Against the Australia dollar, the greenback edged up to 0.779 from an early low of 0.7847. On the upside,
0.75 is seen as the next resistance level for the greenback.
Looking ahead, the German IFO business climate index for February is due at 4:00 am ET.
In the New York session, U.S. existing home sales data for January is set to be published.
At 8:45 am ET, European Central Bank Board member Yves Mersch takes part in a panel discussion on “The Benefits to Achieving a Capital Markets Union” organized as part of a Dialogue on creating an EU Capital Markets Union organized by the London School of Economics and Political Science and Goldman Sachs.
The material has been provided by InstaForex Company – www.instaforex.com