The dollar held steady, not changing much against a basket of major currencies on Friday, as traders awaited to get a clearer picture on the possible Western military intervention in Syria.
The dollar index, which tracks the performance of the USD against a range of major currencies, rose by 0.03% and traded at 89.78 points. For many analysts, the world is heading for a trade war, and the risk of war in Syria is escalating. The prospect of Western military action in Syria hangs on the Middle East, but there was no clear sign that a US attack was imminent.
While concerns about Syria may be slightly eased, market experts are looking for some geopolitical certainty.
The Federal Reserve may need to raise interest rates at least three times this year, facing a strong US economy, even if potential trade disruptions pose risks, Boston Fed President Eric Rosengren declared.
The preliminary reading of consumer confidence from the University of Michigan for this month dropped to 97.8, down from 101.4 in March. Despite falling in April, the University of Michigan’s consumer confidence index remains at a high level with previous benchmarks.
The dollar was on its way to a weekly gain of 0.4% against the Japanese yen, and 0.3% against the Swiss franc. The Swiss and Japanese currencies are often searched in times of global tension, mostly thanks to the fact that they have large current account surpluses.
The weakness of safe-haven currencies also meant investors were less worried after a week of trade tensions between the United States and China, and the possibility of a US-led missile strike on Syria.
The British pound rose to a 10-week high against the dollar and pulled itself out of a six-month range against the euro, prompting investors to close their euro positions.