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US Dollar Index inching higher around of 83.50

FXstreet.com (Barcelona) - The greenback, in terms of the US Dollar Index, is trimming yesterday losses in the vicinity of 83.50, propped up by US data.

Stronger-than-expected Reuters/Michigan Consumer Sentiment in May in combination with positive results from the Chicago PMI have propelled the USD to fresh highs around 83.65, as the Fed’s ‘tapering’ talks re-emerged. “On balance, we do not think that the economic data are strong enough to warrant tapering off QE3 in the near term. However, the FOMC minutes and several speeches by FOMC participants reveal an increasing appetite for tapering off QE3. Therefore we have changed our forecast for the Fed slowing down its asset purchases to the turn of the year ((December 2013/January 2014), from 2014Q1. We expect the Fed to terminate QE3 altogether in 2014”, assessed Philip Marey, Senior US Strategist at Rabobank.

At the moment, the index is advancing 0.52% at 83.49 and according to tradingcentral.com the next resistance levels align at 83.70 and 83.95 while support levels line up at 82.95, 82.80 and 82.60.

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