The U.S. Dollar rallied against the Yen as investors look forward to the Federal Reserve’s two-day monetary policy meeting while speculating on whether policy makers will scale back the monthly asset purchases or not. The greenback received support as demand for safe havens increased while the New York Federal Reserve’s Index confirmed that manufacturing improved more than forecast and reached a three-month high.
The Yen declined against most of its Forex exchange counterparts after global stocks increased, denoting a drop in demand for refuge. The Japanese currency traded low versus the greenback as market investors positioned themselves in anticipation of the Federal Reserve’s monetary policy meeting.
Elsewhere in online Forex, the Euro traded mixed as the market remained volatile ahead of the Federal Reserve’s policy meeting. The shared currency advanced on data out of the E.U. which revealed that the trade surplus contracted from EUR18.1 billion to EUR16.1 billion in April due to a 0.8% drop in exports and an increase of 0.5% in imports which caused the surplus to post lower than previously predicted. The figures prompted the Euro to advance against the Yen as they denoted near record highs despite the small narrowing.
Gold prices dropped at the start of the week as those trading Forex exercised caution ahead of the Federal Reserve’s policy meeting. Uncertainty over the future of the current U.S. monetary policy weighed on the price of gold.
Lastly, New Zealand’s Dollar strengthened versus the greenback as consumer confidence reached a three-year high.