Today's forex news : The dollar is on track to have its best weekly closing in two years

Today's forex news : The dollar is on track to have its best weekly closing in two years

On Friday, April 15, here's everything you need to know:

Following a dramatic decline on Wednesday, the US Dollar Index (DXY) climbed sharply on Thursday, reaching 100.76, its highest level since March 2020, buoyed by rising US Treasury bond yields and safe-haven flows. The DXY consolidates its weekly gains as markets quieten on Easter Friday. The US Federal Reserve will issue March Industrial Production statistics ahead of the weekend, which is unlikely to cause a significant market reaction.

Following its April meeting, the European Central Bank (ECB) confirmed on Thursday that its policy settings will remain unchanged. ECB President Christine Lagarde underlined at the press conference that QE will stop in the third quarter and that the first rate hike will occur after asset purchases are completed. Despite acknowledging that the risks to the inflation forecast are biassed to the upside in the near term, Lagarde's overall dovish tone sparked a massive euro selloff.

The benchmark 10-year US T-bond yield soared beyond 2.8 percent on Thursday, as the ECB's policy stance highlighted the expanding policy divergence with the Fed. Furthermore, the S&P 500 Index dropped more than 1%, indicating a negative move in risk sentiment.

Today's forex news : The dollar is on track to have its best weekly closing in two years

EUR/USD : On Thursday, the EUR/USD fell to 1.0757, its lowest level since April 2020, before rebounding after profit-taking in the late American session. The pair is trading in a narrow range over 1.0800 on Friday morning.

GBP/USD : After losing 50 pips on Thursday, the GBP/USD appears to have entered a consolidation period at 1.3050. The steep drop in EUR/GBP shows that the British pound has managed to capture some of the shared currency's outflows.

XAU/USD : On Wednesday, gold ended in the green for the sixth day in a row, but the yellow metal's upside was capped by rising US T-bond yields. XAU/USD finished the week in the green above $1,970, after minor losses on Thursday.

USD/JPY : Early Friday, the USD/JPY reached a high of 126.50, the highest level in nearly 20 years. The Bank of Japan's monetary policy, according to Japanese Prime Minister Fumio Kishida, is geared at reaching its 2% inflation target, not at influencing currency rates.

Bitcoin : Due to risk aversion, bitcoin lost over 5% on Thursday, although it appears to have found support near $40,000. On Thursday, Ethereum plummeted, wiping off the gains it had made on Tuesday and Wednesday. The last time the ETH/USD exchange rate was tested, it was at $3,000.