US dollar: outlook for June 27 - July 3
US dollar index rose on the news that Britain voted to leave the European Union. The dynamics of the US currency was mixed: the greenback strengthened against British pound, the euro and commodity currencies, but suffered losses against Japanese yen and gold. Dollar’s gain versus Swiss franc may be explained by currency interventions of Swiss National Bank to weaken the franc. Demand for American currency as a safe haven allowed US dollar index to test 96.70 on Friday.
Note, however, that the overall bullish potential for the greenback is limited as the US Federal Reserve will be less likely to raise interest rates in the coming months, because of the uncertainty created by Brexit vote.
Data released in America during the past week weren’t very bright and the Fed’s Chairwoman Janet Yellen was very cautious in her testimony to Congress.
Next week America will release final GDP for Q1 on Tuesday, core PCE price index and personal spending on Wednesday and ISM manufacturing PMI on Friday. Support for USD index is around 93,15, while resistance is at 98.00.