Dollar recovers losses after strongest collapse
2023.02.03 02:19
Dollar recovers losses after strongest collapse
By Ray Johnson
Budrigannews.com – The dollar strengthened on Friday in anticipation of additional clues regarding the U.S. economy from nonfarm payrolls data, and markets reduced bets on an imminent pause in the Federal Reserve’s rate hike cycle. The majority of Asian currencies were weaker on Friday.
Even though a private survey revealed that the country’s massive roared back in January from a four-month lull following the relaxation of the majority of anti-COVID measures, the fell by 0.2%.
However, earlier this week’s data presented a mixed picture of the, which may delay a more substantial economic recovery this year.
The majority of currencies that were exposed to China also sank. The fell by 0.2% and by 0.3%, respectively.
A rebound in the dollar, which rose sharply overnight following strong weekly readings, put pressure on regional units as well. Concerns that a strong jobs market could keep inflation higher for longer, necessitating additional interest rate increases by the, were heightened by the data.
Now that January data have been released, markets are waiting for more clues about the US job market. After a 0.5% rebound, the and were expected to finish the week unchanged.
After their respective central banks hinted at a potential pause in their rate hike cycles this year, the dollar was also supported against a basket of currencies by weakness in and.
Traders bet that a potential U.S. recession this year could prompt the Fed to cut rates by the end of 2023, which would result in a strong performance for the majority of Asian currencies this week. However, the central bank did not provide such an indication and instead increased interest rates and stated that it would continue to act against
After data showed that the country’s growth in January was slightly slower than expected, the gained 0.1 percent on Friday. The reading came after data showed that the Japanese were still falling.
The sank 0.2% due to weaker-than-expected results. After the government unveiled its budget for 2023, the currency was also one of the worst performers in Asia this week, falling by 0.9% due to concerns about stretched fiscal spending.
More indications of sluggish economic growth in the nation led to a 0.2% decline in the Antipodean currency, which may prompt the Reserve Bank to reduce its hawkish stance.
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