US dollar falling in value relative to other currencies
Today the US dollar fell against its main trading partners in anticipation of the release of the highly anticipated June consumer price reports. An increase of 1.1 percent in June was not a surprise due to rising energy prices. last month USD had a 1% increase in consumer prices. This was after a 0.6 percent gain in May. core prices most likely will grow by 0.5 percent.
The Mortgage Bankers Association thinks that there was a dip in overall mortgage applications over the last week. It was slightly offset by an increase in refinancing activity. The two main categories of currency alternatives are: The first category is options on currency futures, which are, for instance, traded on the CME. Options on the currency are available, and some of them are traded on the International Securities Exchange. The two separate contract kinds are priced differently and have quite different requirements. Both types of currency possibilities are available in both American and European varieties. European-style options can only be exercised on the expiration date, but American-style options can be exercised whenever you like. They are also settled in different ways.
With buyers looking for selling and sellers looking for buyers, the market is always shifting. Price increases when there are more orders from buyers than sellers, and price decreases when the converse is true. The price will fluctuate as long as there is liquidity, which is defined as open marketplaces with buyers and sellers prepared to transact.
American Dollar’s relation with other currencies
USD/CAD pair fell to 1.3003. The Bank of Canada might consider a rate increase of 75 basis points. So far there is no information from the Canadian government about this topic.
The USD/JPY pair increased to 137.0084 from 136.8648. Much like Canada the Japanese are keeping quiet as there are no Japanese data on the matter yet. The Bank of Japan is anticipated to continue its accommodating monetary policy.
USD/EUR increased to 1.0058. the pair got close to parity before recovering. According to information provided earlier, EU industrial production increased in May. Data on consumer inflation revealed that it was rising faster in France and Spain than in Germany. the European Central Bank is anticipated to hike interest rates.
GBP/USD increased from 1.1845 to 1.1920. the UK’s GDP shrank on an annual basis in May, which helped the pound overnight. With a recovery in manufacturing production following a drop in April, UK industrial production is booming at the moment. The Bank of England will most likely keep up and make a rate increase possibly with a larger 50-basis point.
