Investing.com – The Australian dollar rose against the U.S. dollar on Monday in Asia despite the AI Industry Group Australian Performance of Services Index going down to its lowest level since August 2013 and in the longest period of contraction since it started in 2003.
According to AI Group Chief Executive, Innes Willox, if the services sector does not recover quickly, pressure will build on the Reserve Bank of Australia to reduce interest rates further and the task of fiscal consolidation will be made more difficult in the shorter-term.
AUD/USD traded at 0.8956, down 0.09%, while USD/JPY traded at 104.88 up 0.04% and NZD/USD traded at 0.8263 down 0.09%.
Elsewhere, the dollar rose to four-week high against the euro on Friday after cautiously optimistic comments from outgoing Federal Reserve Chairman Ben Bernanke boosted the outlook for the U.S. economy.
The dollar strengthened after Bernanke said the U.S. economy should continue to improve in 2014, but reiterated that monetary policy will remain “highly accommodative” for as long as needed.
“The combination of financial healing, greater balance in the housing market, less fiscal restraint, and, of course, continued monetary policy accommodation bodes well for U.S. economic growth in coming quarters,” Bernanke said. “Despite this progress, the recovery clearly remains incomplete”.
The comments came after the Fed’s December decision to roll back its asset purchase program to USD75 billion a month from USD85 billion a month starting this month.
EUR/USD traded at 1.3592, up 0.03%. GBP/USD traded 1.6409, down 0.05%,
USD/CHF touched highs of 0.9056, the strongest since December 4 and was trading at 0.9053, 0.03%.
Trading conditions remained thin following the New Year’s holiday, while a severe snowstorm in the northeastern U.S. also kept activity light.
In the week ahead, the Fed is to publish the minutes of its December meeting on Wednesday, while the U.S. jobs report for December is scheduled to be released on Friday. Meanwhile, interest rate decisions by the European Central Bank and the Bank of England will also be in focus.
Coming up on Monday, the U.S. is to publish data on factory orders, while the Institute of Supply Management is to release data on service sector activity.
According to AI Group Chief Executive, Innes Willox, if the services sector does not recover quickly, pressure will build on the Reserve Bank of Australia to reduce interest rates further and the task of fiscal consolidation will be made more difficult in the shorter-term.
AUD/USD traded at 0.8956, down 0.09%, while USD/JPY traded at 104.88 up 0.04% and NZD/USD traded at 0.8263 down 0.09%.
Elsewhere, the dollar rose to four-week high against the euro on Friday after cautiously optimistic comments from outgoing Federal Reserve Chairman Ben Bernanke boosted the outlook for the U.S. economy.
The dollar strengthened after Bernanke said the U.S. economy should continue to improve in 2014, but reiterated that monetary policy will remain “highly accommodative” for as long as needed.
“The combination of financial healing, greater balance in the housing market, less fiscal restraint, and, of course, continued monetary policy accommodation bodes well for U.S. economic growth in coming quarters,” Bernanke said. “Despite this progress, the recovery clearly remains incomplete”.
The comments came after the Fed’s December decision to roll back its asset purchase program to USD75 billion a month from USD85 billion a month starting this month.
EUR/USD traded at 1.3592, up 0.03%. GBP/USD traded 1.6409, down 0.05%,
USD/CHF touched highs of 0.9056, the strongest since December 4 and was trading at 0.9053, 0.03%.
Trading conditions remained thin following the New Year’s holiday, while a severe snowstorm in the northeastern U.S. also kept activity light.
In the week ahead, the Fed is to publish the minutes of its December meeting on Wednesday, while the U.S. jobs report for December is scheduled to be released on Friday. Meanwhile, interest rate decisions by the European Central Bank and the Bank of England will also be in focus.
Coming up on Monday, the U.S. is to publish data on factory orders, while the Institute of Supply Management is to release data on service sector activity.