Mon, Mar 01, 2021 @ 16:23 GMT
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US Dollar Delines Ahead Of Powell’s Senate Testimony

The New Zealand dollar declined slightly today after relatively weak economic data from the country. According to the statistics bureau, the overall retail sales dropped by 2.7% in the fourth quarter after rising by 28% in Q3. This increase was worse than the median estimate of a 0.5% decline. The sales rose by 4.3% compared to the same quarter in 2019. The data came a day before the first interest rate decision by the Reserve Bank of New Zealand.

The British pound rally continued in overnight trading as traders waited for the latest UK employment numbers. The currency rose to 1.4080, which was the highest level it has been in almost three years. The currency has been rallying, helped by the country’s vaccination progress. In a statement last week, the government said that it had already vaccinated more than 15 million people. Also, the recent breakthrough on Brexit helped improve sentiment in the market.

The euro rose against the US dollar ahead of the European Union consumer inflation data that will come out in the morning session. Economists surveyed by Reuters expect the data to show that the headline CPI increased by 0.2% in January, leading to an annual increase of 0.9%. The annual rate will be better than the previous decline of 0.3%. They expect annual inflation to increase by 1.4%. The European Central Bank has a target interest rate of about 2%. Elsewhere, in Switzerland, SECO will publish the latest producer price index (PPI) while the Conference Board will release the latest consumer confidence data. Also, Jerome Powell will testify in Congress.

GBP/USD

The GBP/USD uptrend continued ahead of important UK employment numbers. It is trading at 1.4080, which is slightly below the upper side of the ascending channel on the four-hour chart. The uptrend is also being supported by the 25-day exponential moving average and the Stochastic oscillator. Therefore, the pair may continue rising today as bulls target the next key resistance at 1.4100.

EUR/USD

The EUR/USD pair rose to a high of 1.2177 ahead of the EU inflation data and Jerome Powell’s testimony. On the four-hour chart, this price is above the ascending trendline shown in white. It is also above the 25-day moving average while the momentum oscillator has continued to rise. Therefore, the pair may continue rising, with the next key level at 1.2200.

NZD/USD

The NZD/USD declined slightly after relatively weak retail sales numbers. It is trading at 0.7325, which is slightly below the day’s high of 0.7338. On the hourly chart, the Relative Strength Index is at 55 while the MACD and the Average Directional Movement Index (ADX) are relatively bullish. The moving averages are also bullish. Therefore, the pair may resume the upward trend ahead of the RBNZ decision.

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