At the start of Wednesday trading, the US currency reached a 3.5-week high, supported by the increased yield of US Treasury bonds, after Washington had eased the restraining tone the day before, allowing Huawei to buy American-made goods.
The dollar index fell slightly to 98,051 points to the basket of major currencies, previously reaching a 3.5-week high of 98,134 points.
Last week, the US Department of Commerce added the Chinese telecommunications equipment manufacturer Huawei to the blacklist, but the day before, the same officials decided to issue a temporary permit to a Chinese company to buy US-made goods. The decision of the American side was motivated by the fact that the original ban struck only the shares of Huawei microelectronics exporters in the United States.
The yield on 10-year US state bonds has previously reached 2,428%, slightly falling later than 2,423%.
At the moment, the EURUSD pair is trading down, at 1.1153.
For the British pound, another relatively busy day is scheduled in the economic calendar. The UK's April inflation data is preparing for release this morning.
Forecasts for the annual inflation rate accelerated from 1.9% to 2.2% in April, which is a positive indicator for the pound. It is also predicted that inflation data monitored in wholesale trade will rebound, and PPI's forecast in April will increase by 1.3% compared with the previous month.
While any increase in inflationary pressure will be positive for the pound, its direction in the Forex market still depends on EU parliamentary elections this week, topics around Brexit and candidates for the prime minister position and their statements.
At the time of publication, the GBPUSD pair is trading down at 1.2664.
Forex trading recommendations:
GBPUSD: Sell. Entry point – 1, 2682. Take Profit – 1, 2655. Stop Loss – 1, 2729.
EURUSD: Sell. Entry point – 1, 1157. Take Profit – 1, 1141. Stop Loss – 1, 1185.
USDCAD: Sell. Entry point – 1, 3412. Take Profit – 1, 3394. Stop Loss – 1, 3442.
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