The US dollar remained hovering at a 20-year high despite seeming to calm down in Wednesday's trade yesterday, but still putting pressure on most other major currencies in the market.
The dollar index which measures the US dollar along with 6 other currencies is still playing at a peak around 109.00 which was also reached last July for the highest record of 2 decades.
Being a factor affecting the momentum of the US dollar, the United States (US) ADP employment data report for the private sector published in yesterday's New York session recorded a lower reading than expected at 132,000 for August although it was slightly better than the previous month at 128,000.
This will further strengthen expectations for the dismal release of the US NFP jobs report for August on Friday and could push the US dollar to remain underperforming.
Despite the decline for the US dollar, analysts are optimistic for a long-term strengthening of the currency king after a hawkish indication by Federal Reserve (Fed) Chairman Jerome Powell at the end of last week in Jackson Hole.
The statement delivered by Powell has closed expectations of the central bank's choice to slow aggressive rate hikes after the latest US inflation readings began to show a decline after previously hitting a 40-year record high.
Investor confidence has risen to around 70% for the expectation of a third consecutive 75 basis point interest rate hike by the Fed at the September FOMC meeting.
Meanwhile, also sending a hawkish signal to investors is the European central bank to continue tightening its monetary policy after the first interest rate hike in over a decade was implemented recently.
Thus, the European Central Bank (ECB) is seen to be more desperate to be on a policy tightening track that is lagging far behind other central banks that have started earlier.
Euro currency trading towards the end of the week was seen struggling to stay above the $1.0000 parity level (€1=$1).
However, the increase in the value of the Euro is seen to be limited due to the restriction of Russian gas supply to Europe through the Nord Stream 1 pipeline starting Wednesday yesterday due to maintenance work.
Investors are looking forward to the development of the emergency plan announced by the President of the European Commission, Ursula von der Leyen in an effort to deal with the problem of soaring energy prices in Europe.
Other major currencies such as the Australian dollar, the New Zealand dollar and the Canadian dollar are seen to remain depressed in the market due to the dominance of the US dollar for now.
Similarly, gold commodity trading that was traded decreased almost to $1,700 per ounce due to the pressure of the increase in the value of the US dollar in the market.
