Dollar falls broadly on dovish Fed comments and rally in commodity currencies - Jan 11

The early rally in the commodity currencies in Australia where gold also surged $ 20 an ounce prompted traders to buy the single currency in Asian morning, pushing price above its last week's high of 1.4485 and the pair subsequently rose to 1.4557 in NY mid-session on a quiet day on the data front for both the U.S. and Eurozone.

Despite a brief recovery to 1.0205 (eur/chf bounced from intra-day low of 1.4725 to 1.4795) due to comments from SNB Chairman Philipp Hildebrand, the greenback remained soft against the chf on Monday. Hildebrand said the SNB will continue to prevent any excessive appreciation of Swiss franc against the euro and the SNB has no exchange rate target but it will monitor foreign exchanged market developments very closely. The pair eventually fell to 1.0130 in NY mid-session before stabilizing.

Versus the yen, the greenback has continued its correction of recent rally and price ratcheted lower to intra-day low of 91.81 in NY mid-session. The pair's weakness on Monday was in part due to China's strong trade numbers released over the weekend.

The British pound rallied to a 1-week high of 1.6194 in European morning despite speculation that weeks of arctic weather in the U.K. may endanger the economic recovery of the country as manufacturing and construction area may be hard-hit by the cold spell. Cable later retreated from there in U.S. session and fell to as low as 1.6093 but it still managed to close the day up more than 0.2%.

Data to be released on Tuesday include Japan trade balance, U.K. trade balance Canada trade balance, U.S. trade balance.