DXY closely reached the level of 93 after strong rebound from the bottom at the level of 91.8. And the extreme hawkish speeches by multiple Fed officials play a pivotal role in successfully altering the unfavorable situation of Powell‘s dovish message after interest discussion. An employment data released by the US just now also changes the negative impact of the previous ADP national employment report. Besides, the US senate voted on Biden’s $1 trillion infrastructure plan on Saturday, passed with an overwhelming result of 67:27, during which remarkably 18 republican lawmakers switched their side to support the plan. So traders state that the rest infrastructure plans will also be passed with the support of some republican lawmakers.To get more news about WikiFX, you can visit wikifx.com official website.
  The implementation of related infrastructure will not only bring the recovery of the US economy, but also raise the price of resources and commodities used by the plan in the future. In addition, it‘ll increase the odds of inflation in the US and Fed’s continuous tighten monetary policy against hot economy and inflation, beneficial to the USD for a long term. However, the Europe and Japan performed worse, among which Germany experienced a chequered performance which can be acceptable, while French and Italys performance was disappointing enough to drag down the whole level of the Euro area.
  It is believed that the pandemic will have a bad bearing on the economic data of Japan. The market will focus on if the pandemic will get worse or on the House of Representative Selection in Japan before October. Yoshihide Suga forcibly held the Tokyo Olympic Games with bad performance in fighting the pandemic, making his poll rate record low. A poll released by Asahi newspaper shows that Prime Minister Yoshihide Suga‘s support slid to 28% for the first time from 30%, a record low after he took office, darkening the ruling Liberal Democratic Party’s prospects in futures general election.
  The bank of Japan doesn‘t feel any pressure to raise interest rates due to the long-term deflation and the non-existed inflation so far in Japan. On the contrary, many countries are likely to under the pressure of interest rate hikes, probably attracting a large number of carry traders, who choose to buy the currency that is under the pressure from interest rate rise and sell JPY with negative interest rate and no possibility of raising interest rate. It is estimated that JPY will fall easily under the great pressure of selling. Compared with the weak JPY and EUR as USD’s main opponents, DXY is expected to increase further.
  Notably, 5 Fed officials will deliver speeches respectively this week, with high possibility of releasing hawkish message according to the current situation. In addition, more attention should be paid to that whether Powell will announce the plan to finish the Quantitative Easing(QE) policy at the Financial Stability Board(FSB) annual meeting on August 26. If Powell declares to be absent from the meeting like Bernanke did in his last year in office, the financial market will predict that Powell may not be re-elected. Meanwhile, the market hype of dovish Powells departure may be conducive to a bullish USD.