Dollar index unwinds ahead of GDP data
London (Nov 7) The US dollar index lost around 0.2% to 80.49 and remains fairly well supported above 80 heading into the business end of the week. Some positive data prints from Europe and more taper talk were at the forefront of the FX moves. Fed member Williams said he wants to see a pretty convincing case that the economy can grow faster than recent trend before reducing asset purchases. Meanwhile, Pianalto hopes the recovery will accelerate to allow the Fed to taper. This is probably the most dovish we’ve heard Fed members since the meeting and as a result weighed on the USD.
Later today we have the US Q3 GDP reading which is expected to show a 2% rise. Given the recent surprises to the upside, some analysts feel there is upside risk to this data. We also have unemployment claims due out with the market looking for a fall to 336,000. On the Fedspeak side of things we have Dudley and Stein speaking which makes up for a busy session ahead for the greenback.