The dollar bulls finally rally. While Yellen’s testimony has been cautious, it becomes clear that the Fed is open to a quicker tightening. Yellen does see a faster move if the current quick improvement in jobs continues. One headline that did emerge in a separate report which mentioned “stretched valuations” in the stock market, singling out biotech and social media firms.
It took the markets time to make the move, which encompasses all currencies, including the safe haven yen.
Here is how the EUR/USD looks like:
- EUR/USD is down below support of 1.3585 and is finding support at the next line: 1.3550. Below this, we have 1.35. Portuguese issues also weigh.
- GBP/USD is down to 1.7140, after initially breaking to new multi-year highs. The UK inflation report earlier in the day helped the pound.
- USD/JPY is getting back towards the “magnet” level of 102 and is up to 101.70.
- USD/CAD continued advancing, jumping above 1.0760, following the trend that began with the weak Canadian jobs data.
- AUD/USD dips to lower waters, falling to 0.9350 before recovering.
- NZD/USD confirmed the drop below 0.88 and trades around 0.
- EUR/GBP: While the dollar is not involved in this cross, the market jitters did result in a new low at 0.7910.