EUR/USD (a 4-hour chart)
The U.S. dollar grew against the Japanese yen on Tuesday, as the expectations that the Federal Reserve will lower stimulation program continue to dictate the U.S. currency.
Strengthening of the dollar against the yen happened after U.S. manufacturing data were published, which were weaker than expected and pushed the U.S. currency below 100 yen which happened the first time in three weeks.
However, the dollar's falling was short-lived as investors continued to put the fact that the economic recovery in the United States is ahead of other countries. The data showed that the U.S. trade deficit in April grew not as much as economists had expected, prompting the strengthening of the dollar.
The favorable U.S. data raised expectations that the Fed will begin to curtail incentive program of bond purchases. To minimize the incentive is generally regarded as a positive factor for the dollar.
"The upward market sentiment about the U.S. economy is quite entrenched, - says Serebrjakov. - Investors will not change their opinions as a result of only one weak report publication."
U.S. data are becoming increasingly important since the Fed indicated last month that it begin to minimize the program of monthly purchases of bonds, if the U.S. economy continues to recover.