US dollar rises after retail sales and jobs data
THE US dollar rose against a basket of currencies on Thursday (Aug 15), after data showed lower than expected jobless claims and a rise in retail sales, as markets look for signs of how the broader health of the economy will influence the size of upcoming rate cuts.
The dollar index, which tracks the US currency against six major peers, was at 102.96, up 0.36 per cent.
The pound nudged higher on Thursday after solid British gross domestic product data, and the euro held above US$1.10, near the previous day’s more than seven-month peak, underpinned by US inflation data which reinforced expectations of a Fed rate cut next month.
Markets were calmer after recent ructions, but the pound was up 0.24 per cent on the dollar at US$1.2857 after data showed Britain’s economy grew 0.6 per cent in the second quarter of 2024, in line with economists’ expectations and building on a rapid 0.7 per cent recovery in the first quarter of the year.
The pound also strengthened on the euro which dipped 0.2 per cent to 85.63 pence.
The European common currency was steady on the dollar at US$1.1010. It reached US$1.10475, its highest level this year, on Wednesday, as markets digested the US inflation numbers.
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The yen was steady at 147.31 per dollar after data showed Japan’s economy expanded by a faster-than-expected annualised 3.1 per cent in the second quarter due to a solid pickup in consumption, keeping another near-term rate hike on the table.
While the yen has inched away from the seven-month high of 141.675 per dollar touched during last week’s market mayhem, it remains well beyond the 38-year lows of 161.96 it was rooted to at the start of July.
Bouts of intervention from Tokyo early last month and then a surprise rate hike from the Bank of Japan at the end of July wrong-footed investors who bailed out of popular carry trades, lifting the yen.
The Norwegian crown firmed slightly after the country’s central bank kept rates on hold, and was at 11.76 per euro and 10.68 per dollar.
The Australian dollar was up 0.5 per cent at US$0.6630 after data showed Australian employment sped past forecasts in July, even as the jobless rate ticked higher to a 2-1/2 year high.
Elsewhere, China’s yuan weakened against the dollar, weighed down by disappointing data that showed China’s factory output growth slowed and missed expectations in July. REUTERS
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