Dollar Retains Strength Ahead of FOMC Week

The US dollar demonstrated somewhat mixed performance this week but retained its strength for the most part. Many market analysts consider this as a sign that traders are strongly convinced in inevitability of an interest rate hike from the Federal Reserve.
While some analysts were not sure if the dollar would be able to maintain its rally, the currency continued to rise against most of its major peers. The notable exception was the Great Britain pound that reversed its losses and managed to gain over the week. The euro also bounced after reaching multi-year lows, ending the week flat.
On the other hand, commodity currencies, including the Australian and the New Zealand dollars, were very weak. The Japanese yen also continued to fall to new multi-year lows.
All in all, the greenback retained its strength, and dollar bulls wait eagerly for the Fed meeting in hopes that comments of the central bank will reinforce their optimistic outlook.
EUR/USD closed at 1.2948 after opening at 1.2955 and reaching the weekly low of 1.2859. GBP/USD fell from 1.6168 to 1.6052 during the week but bounced to 1.6258 by the weekend. USD/JPY advanced from 105.02 to 107.34.

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