The ICE US Dollar Index, used to track the strength of the dollar against major currencies fell back under 80 in currency market trading today, giving oil prices an unwelcome boost to the new year.
Latest US Dollar Index Rate
The ICE US dollar Index is currently at 79.915, after opening the session at 80.522.
A weaker US dollar tends to add weight to higher commodity prices, as they are priced in the American currency.
The US dollar fell 1.1 percent to $1.3073 per euro at 18.55 GMT, the biggest intraday decline since November 30. The US dollar declined 0.3 percent to 76.65 yen.
However, futures traders last week boosted bets the euro will weaken, which would keep the US dollar well supported. The number of wagers made by hedge funds and other large speculators betting on a drop in the 17-nation currency increased to a record 127,879 contracts more than those anticipating a gain, according to the Washington based CFTC (Commodity Futures Trading Commission).
“The safe haven function of the US dollar is still alive. The dollar will be strong in 2012.” said Achim Walde, head of global fixed income and currencies at Deutsche Bank.
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US Dollar Index falls back under 80 adding weight to higher oil prices
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