With eyes on the CPI, the US dollar ends its best week since September thanks to robust NFPs.

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The DXY Index will end a 0.75% winning week after rising above the 20-day SMA and closing at 104.05.
-The November US Nonfarm Payrolls and Average Hourly Earnings both increased. The rate of unemployment decreased.
-US CPI inflation data is expected on Tuesday of next week.

Due in large part to strong labor market data and a spike in yields that indicates that investors are postponing rate cuts in 2024, the US Dollar (USD) continued to rule the financial markets, rising to 104.05. November’s economic reports—most notably those on average hourly earnings, the unemployment rate, and nonfarm payrolls—all contributed to hawkish bets on the Federal Reserve (Fed), which in turn drove gains for the USD Index (DXY).

October’s moderate US inflation data fueled expectations for a dovish Federal Reserve position at the start of November. Nonetheless, indications from Fed officials about additional tightening are lowering these expectations, and solid labor market data confirms the bank’s cautious approach, which calls for more proof that the economy is contracting. The Fed meeting the following week and the forthcoming inflation data from November will be crucial factors in determining the short-term trajectory of the USD.

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