2024-01-05T04:49:48+00:00
A-
A
A+
/ The dollar rose during early trading today, Friday, heading towards recording its strongest weekly performance since July due to the decline in expectations of a sharp and early cut in interest rates this year, ahead of the release of US jobs data later today, which is being closely followed.
Thursday’s data showed that US private sector employers hired more workers than expected in December, indicating continued strength in the labor market, which should continue to support the economy.
This helped the dollar overcome its weakness. The dollar index, which measures the performance of the US currency against a basket of currencies, recorded 102.39 in early trading on Friday. The index rose 1 percent this week, its strongest performance since the week ending July 23.
The dollar’s recovery will face a test when the non-farm payrolls report is released later in the session. Economists polled by Reuters expected the creation of 170,000 jobs in December, down from 199,000 jobs in November.
“The strength of the dollar that we are seeing at the beginning of 2024 may have more to do with demand for safe havens as stock markets face difficulties and market volatility increases,” said Hamish Pepper, fixed income and currency strategist at Harper Asset Management.
The CME Group’s Fed Watch tool showed a decline in traders’ bets on lowering interest rates, as markets now expect a 65 percent chance of a rate cut in March, compared to 86 percent the previous week.
With the rise of the dollar, the yen fell significantly this week, as the Japanese currency fell by 2.5 percent against the dollar and is heading to record its weakest weekly performance since June.
The yen fell on Friday by 0.06 percent to 144.72 to the dollar, after touching the lowest level in more than two weeks at 144.90 earlier in the session.
The euro rose in the latest trading by 0.09 percent to $1.0953, on track to record a weekly decline of 0.8 percent, ending a series of gains that lasted three weeks.
The pound sterling reached $1.2694 in recent transactions, rising by 0.12 percent during the session, but it is still heading toward a slight decline for the week.
In terms of cryptocurrencies, Bitcoin fell by 0.91 percent to $44,082.61, and Ether fell by 0.53 percent to $2,263.75.