Dollar Comes Under Selling Pressure Ahead of Fed

The US dollar was under selling pressure today because traders are becoming more and more cautious as the Federal Reserve’s policy meeting is nearing. Economic reports from the United States were not helping the greenback either.

The US currency demonstrated losses against almost all its major rivals following the rally to the highest level in 11 and half years. There can be several possible explanations for such behavior. One of them is just profit-taking after the impressive gains. Another is the caution on the part of traders as it is usually a good idea to trim one’s positions ahead of a major report.

All of the US economic indicators released today came out far below expectations, adding to the pressure on the dollar. While the currency was able to shrug off negative data previously, it might have buckled under the weight of all the negative reports at last.

EUR/USD went up from 1.0489 to 1.0588 (1 percent) as of 17:48 GMT today. GBP/USD climbed from 1.4735 to 1.4828. USD/JPY traded at 121.38 following the earlier drop from 121.43 to 121.08.

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