Greenback is mixed today, looking for direction as signals indicate that dollar strength could be a fixture in coming months even while the dollar index dips due to the euro’s huge surge today. It’s an interesting way forward, and some think that the euro is overbought at this point.
For now, the US dollar is mixed against its major counterparts. The big move today, though, is a surge by EUR/USD. The euro is heading much higher after the ECB decided not to cut rates, and Mario Draghi kept his rhetoric much the same, talking about some of the eurozone’s recent growth, but also acknowledging the economic risks ahead.
The fact that the euro is most heavily weighted in the dollar index accounts for the fact that it is down on the day, even though the greenback is higher against the yen and the pound. Some analysts feel that the euro is overbought, however. The US economy still has potential for better growth than the eurozone economy, and these fundamentals are expected to provide some measure of support for the greenback in the months to come.
At 14:37 GMT the dollar index is down to 79.8750 from the open at 80.1040. EUR/USD is up to 1.3835 from the open at 1.3730. GBP/USD is down to 1.6702 from the open at 1.6716. USD/JPY is up to 103.0945 from the open at 102.3015.
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