The market opening earlier this week remained saw the US dollar move weak with a focused focus on the release of New Zealand inflation data which recorded a jump to a 32 -year high.
The US dollar began to depreciate at the end of last week's trading session with market analysts assessing the situation as being driven by profit-taking activities.
Thus, in a market sentiment that is still considered risk-off, the US dollar still has the advantage of re-strengthening while the expectation for the Federal Reserve (Fed) to continue to raise interest rates at the latest policy meeting.
Fed members have signaled for the possibility of interest rates being raised to 75 basis points at a meeting late this July, making the 75 basis point increase twice in a row.
Market players also placed confidence in the implementation due to the US inflation reading which remained at a high level.
Still, the Fed rejected expectations for a hike of up to 100 basis points as was implemented by the Bank of Canada (BOC) last week.
With the temporary depreciation of the US dollar, most other major currencies in the market have taken advantage of room for appreciation since last weekend, but investors will be wary of the possibility of a change in the direction of price movements again this week.
After falling below $ 1.00 against the US dollar, the Euro has the potential to rebound following expectations of an interest rate hike by the European Central Bank (ECB) at a policy meeting this week, becoming the first rate hike in more than a decade.
However, the risk factor of rising gas prices in Europe regarding the pressure of the Nord Stream 1 pipeline issue is seen to limit the rise of the Euro this week.
The pound will await the release of the UK employment data report as well as UK inflation data which will be the focus of the central bank of England (BOE) for a policy meeting in early August for investors to assess further movements.
High -yielding currencies such as the Australian dollar maintained gains against the US dollar during the Asian session earlier this week.
Similarly, the New Zealand dollar still maintained its appreciation after being supported by the release of New Zealand inflation data which soared to its highest level in more than 3 decades for the second quarter of 2022 reading.
