Dollar falls Investors think about Friday’s employment report
2023.01.09 02:41
Dollar falls Investors think about Friday’s employment report
Budrigannews.com – On Monday, investors weighed in on a slew of economic data that raised hopes that the Federal Reserve would slow down the rate at which it raises interest rates.
Friday’s data showed that nonfarm payrolls in the United States increased by 223,000 jobs in December, but average earnings increased by 0.3%, which was lower than the 0.4% increase in November.
In December, the U.S. services industry activity contracted for the first time in more than two and a half years due to weakening demand. This was one more sign that the economy was slowing down.
This caused the, which compares the US dollar to six major currencies, to fall 1.15 percent on Friday. The index was 0.01% higher at 103.720 on Monday, up 8% in 2022.
The U.S. central bank’s easing of its aggressive monetary tightening policy has been a source of optimism for investors. The probability of a half-point hike in February in Fed fund futures has decreased from approximately 50% a month ago to approximately 25%.
However, analysts point to the still tight labor market as a potential source of concern for Fed officials.
According to Mansoor Mohi-uddin, chief economist at the Bank of Singapore, “December’s payrolls report shows the U.S. jobs market remains too tight to allow the Fed to step down to a 25 bps rate hike next month.”
“We remain cautious on the near-term outlook for risk assets, as we expect the Fed to remain more hawkish than the market anticipates.”
Investors will concentrate on the consumer price index data that is due on Thursday because the next Fed meeting is scheduled for the beginning of the following month.
Core inflation could resume in early 2023, despite Citi’s statement that it anticipates another “softer” core CPI print with some upside risk.
“There are still strong underlying inflationary pressures and further loosening in financial conditions would likely not be a desirable outcome,” as stated, “we continue to expect the Fed to hike by 50 basis points in February.”
After far-right former President Jair Bolsonaro’s supporters invaded the country’s Congress, presidential palace, and Supreme Court, the Brazilian real had not yet traded elsewhere.
Sterling was last trading at $1.2099, up 0.06% on the day, having gained 1.5% on Friday. The Japanese yen gained 0.12% against the US dollar, reaching 131.94 per dollar.
After closing 1.17 percent higher on Friday, the euro was up 0.11 percent at $1.0656.
The Australian dollar gained $0.689 against the US dollar, while the gained 0.02 percent to $0.635.
Currency bid prices at 0128 GMT
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar $1.0660 $1.0645 +0.14% -0.51% +1.0668 +1.0640
Dollar/Yen 131.8650 132.0700 -0.13% +0.51% +132.2500 +131.7400
Euro/Yen 140.57 140.58 -0.01% +0.19% +140.8000 +140.4600
Dollar/Swiss 0.9275 0.9279 -0.03% +0.32% +0.9279 +0.9264
Sterling/Dollar 1.2104 1.2093 +0.12% +0.11% +1.2128 +1.2092
Dollar/Canadian 1.3432 1.3448 -0.10% -0.85% +1.3444 +1.3420
Aussie/Dollar 0.6891 0.6876 +0.28% +1.14% +0.6907 +0.6875
NZ 0.6348 0.6350 +0.01% +0.01% +0.6372 +0.6337
