Even with positive data in the United States, the greenback continues to lose ground against its major counterparts. Today, the dollar index has taken a dive, thanks in large part to the way that continued quantitative easing in the United States makes other currencies attractive.
Even though the economic data in the United States has been improving, there are no signs that the Federal Reserve is ready to more aggressively taper its quantitative easing program, nor is there any indication that interest rates will be on the rise anytime soon. Indeed, remarks from Fed Chair Janet Yellen seem to indicate that interest rates will remain low for quite some time.
As a result, other currencies appear more attractive against the US dollar. The euro is especially attractive when placed next to the greenback, due to the fact that eurozone data has been improving. Even efforts by ECB officials to talk the euro down are falling flat.
For now, the dollar is likely to remain weak, until traders have a good reason to buy.
At 13:12 GMT DXY is down to 79.0870 from the open at 79.5040. EUR/USD is up to 1.3939 from the open at 1.3875. GBP/USD is up to 1.6984 from the open at 1.6867. USD/JPY is down to 101.6100 from the open at 102.1450.
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