OTTAWA (dpa-AFX) - The U.S. dollar gained ground against its major rivals on Tuesday, after Federal Reserve Chairman Jerome Powell said that U.S. economic outlook has clearly brightened amid faster vaccination rates and fiscal stimulus.
Powell however cautioned that the economy is 'not out of the woods yet' and added, 'While the recovery is gathering strength, it has been slower for those in lower-paid jobs.'
The central bank is focused on these longstanding disparities as they weigh on the productive capacity of the economy, he added.
U.S. Treasury Secretary Janet Yellen said in an interview that the Federal Reserve may have to hike interest rates to keep the economy from overheating.
New orders for U.S. manufactured goods showed a notable rebound in the month of March, according to a report released by the Commerce Department on Tuesday.
The Commerce Department said factory orders jumped by 1.1% in March after falling by a revised 0.5% in February. Economists had expected factory orders to surge up by 1.3% compared to the 0.8% drop originally reported for the previous month.
Meanwhile, a separate report released by the Commerce Department showed the U.S. trade deficit widened to a new record high in March, coming in at $74.4 billion, up from a revised $70.5 billion in February.
The dollar index rose to 91.40 in the New York session, and despite easing to 91.26, was up by 0.35% a little while ago.
Against the Euro, the dollar firmed up to $1.2017, gaining 0.4% from previous close.
The Pound Sterling was weaker, fetching $1.3885, compared to $1.3910 Monday evening. The UK manufacturing sector grew at the fastest pace on record in April underpinned by production and new orders, final data from IHS Markit showed.
The Yen weakened to 109.29 a dollar, about 0.2% less from previous close of 109.07 a dollar.
The Aussie was weak with the AUD-USD pair at 0.7712, sliding from 0.7763.
The Swiss franc, at 0.9132 a dollar, was weaker by about 0.25%. Swiss consumer sentiment improved in April as expectations regarding economic outlook turned positive, according to quarterly survey results from the State Secretariat for Economic Affairs, or SECO.
The consumer confidence index rose to -7.1 in April from -14.2 in January. The score has returned approximately to its pre-crisis level of early 2020.
The Loonie weakened to 1.2304 a dollar, falling from 1.2279, despite a sharp surge in crude oil prices.
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