Dollar maintains upward momentum as Havens retreat

Last week, the US Dollar strengthened after the release of strong economic data on Wednesday, posting a second consecutive increase for just the first time in two weeks, and fueling speculation that the Fed has more reasons to raise interest rates again. The greenback gained a lift after the US Commerce Department revised up gross domestic product to a 3.0% annual rate in Q2, the quickest in more than two years. In addition, the ADP National Employment Report showed US private sector employers hired 237,000 workers in August 2017 for the biggest monthly increase in five months, driving expectations for a solid US August non-farm payrolls figure released on Sept 01, 2017.

Crude prices fell further early last Thursday, as refineries shut down by deadly storm Harvey in the key Oil-producing US Gulf Coast struggled to get back online, further piling up supplies. The storm caused the closure of refineries in the US Oil-producing heartland, which traders fear will lead to bigger Crude stockpiles and push down prices. Analysts said the storm will likely halt any Oil price recovery despite an OPEC-led effort to bolster the market by slashing production until March next year.

Meanwhile China’s Yuan weakened slightly, taking a breather from its 0.8% rise against the US Dollar so far this week, as the greenback rebounded after strong economic data. The Chinese currency, which hit more than 14-month highs last week, has gained around 2% so far this month and is on track for the best month since July 2005 when the Yuan was revalued and taken off a fixed Dollar peg. Prior to the market open last Thursday, the People’s Bank of China raised its official Yuan midpoint to 6.6010 per Dollar, the strongest since June 24, 2016.