As market analysts had feared, the US dollar showed a sharp decline again as the focus of trade at the end of the week was directed to the speech delivered by the Chairman of the Federal Reserve (Fed) Jerome Powell.
Powell's statement was considered somewhat dovish when he expressed the suggestion that the central bank will not raise interest rates in the near future.
However, he explained that the tightening of monetary policy is still a necessity based on the observation of the latest economic indicators including economic growth and employment.
He also underlined that the risk is still focused on the current inflation which has started to show an upward trend in recent months.
The dollar index fell to around 106.00 points before recovering slightly this morning while the 10-year US treasury yield was still excellent reaching a high of 5.00%, the highest since 2007.
At the end of this week's trading, market focus was directed to China's economic data in the Asian session with the 1-year and 5-year prime lending rates remaining at 3.45% and 4.20% respectively.
In the European session, UK retail sales data as well as the German producer price index (PPI) will be watched which will influence the movement of European currencies.
European currencies, the Euro and the Pound showed further declines in the Asian session this morning despite recovering slightly in the previous session as the US dollar weakened.
The same is true for Asian currencies, the Australian and New Zealand dollars.
The Canadian dollar showed strengthening in the New York session yesterday as investors' focus will turn to Canadian retail sales data to be published tonight.
The price of WTI and Brent crude oil continued to show further increases, reaching the price level of $89.00 and $92.30 per barrel, respectively.
The price of gold continues to excel maintaining the bullish trend by jumping to $1,980 with analyst targets for the yellow metal reaching $2,000.
