Starting trading weakly in the early sessions at the market opening yesterday, the situation changed 360° in the New York session when the king of currencies was back on fire again.
Initially, the market movement started in the Asian session on Monday yesterday influenced by market sentiment that recovered with positive developments in China when movement restrictions were increasingly relaxed in key locations.
However, the US dollar strengthened again at the opening of the New York session and was later supported by the release of the ISM survey data for the service sector in the United States (US) for November which showed higher figures than expectations and readings of the previous month.
This indicates a healthy economic development in the US and supports the central bank to continue monetary policy tightening measures.
Thus, the US dollar has returned to display a re-strengthening in the market. Even so, analysts warned the direction of price movement for the US dollar has the potential to be volatile and volatile throughout this week ahead of next week's FOMC meeting.
Other major currencies in the market were trading gloomy again due to the strengthening exhibited by the US dollar.
Today's Asian session will focus on the Australian central bank's (RBA) policy meeting at 11.30am local time which will have an impact on the Aussie dollar.
The RBA is expected to raise interest rates by 25 basis points to 3.10%, seeing as it slows down the policy tightening that has already started since last October.
The European Central Bank (ECB) will meet on the same day as the Federal Reserve (Fed) next week while the market is still puzzled over the setting of monetary policy in Europe.
ECB policymaker Gabriel Makhlouf is of the view that 50 basis points is the minimum level for interest rate hikes, and does not see a 75 basis point increase as necessary.
The commodity market 'bleeded' at the beginning of the week when gold and crude oil initially recorded an increase in their respective values and then declined significantly due to the strengthening of the US dollar in the market.
Similarly, the situation in the stock and crypto markets saw a fall following the dominance of the US dollar.
