empty
 
 
24.11.2020 09:31 AM
US dollar's local growth

There was a diverse reaction in the currency markets due to yesterday's PMI data. Germany's and France's values of the indicator were generally higher than expected, but the figures from the Eurozone were not so unclear.

Europe's manufacturing business activity index (PMI) rose to 53.6 points this month, and although it was higher than the forecasted 53.1 points, it was still less than the October value of 54.8 points. On the contrary, the value of the business activity index in the services sector was 41.3, which turned out to be significantly lower than the expected value of 42.5 points and the October value of 46.9 points.

Nevertheless, it is clear why the production indicator rose and the value of the service sector indicator fell. This is due to the partial return of the economic activity of enterprises, but the new restrictions imposed have dealt another blow to the servants' sector.

Contrary to the Eurozone, American values of indicators were certainly positive and grew not only above forecasts, but also above the previous October values. The index of business activity in the manufacturing sector (PMI) for this month rose to 56.7 points against 53.4 points a month earlier. The index of business activity in the service sector also surged from 56.9 points to 57.7, with a forecasted decline of 55.0 points.

After the data were published, the US dollar sharply increased across the entire range of the currency market. The price of gold generally collapsed, declining below the strong support level of 1848.00.

What is the possible reason for such a sharp growth of the dollar rate?

We believe that the sale of US Treasury bonds, which caused a sharp rise in profitability, was the reason for an unexpected rise in the dollar rate across the entire currency market. However, the situation returned under the influence of the continuing positive mood in the financial markets, which is associated with the vaccines for COVID-19.

Assessing the overall situation on the markets, we believe that the general sideways dynamics will continue until this week ends.

Forecast of the day:

The GBP/USD pair is trading above the level of 1.3310 again. If it holds above it, it will gain another growth impulse towards 1.3400.

The USD/CAD pair is trading above the support level of 1.3035. It may further decline to 1.2985, in the wake of continued growth in crude oil prices.

This image is no longer relevant

This image is no longer relevant

Pati Gani,
Analytical expert of InstaForex
© 2007-2024
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST
  • Chancy Deposit
    Deposit your account with $3,000 and get $8000 more!
    In March we raffle $8000 within the Chancy Deposit campaign!
    Get a chance to win by depositing $3,000 to a trading account. Having fulfilled this condition, you become a campaign participant.
    JOIN CONTEST
  • Trade Wise, Win Device
    Top up your account with at least $500, sign up for the contest, and get a chance to win mobile devices.
    JOIN CONTEST
  • 100% Bonus
    Your unique opportunity to get a 100% bonus on your deposit
    GET BONUS
  • 55% Bonus
    Apply for a 55% bonus on your every deposit
    GET BONUS
  • 30% Bonus
    Receive a 30% bonus every time you top up your account
    GET BONUS

Recommended Stories

Can't speak right now?
Ask your question in the chat.
Widget callback