The U.S. dollar declined on Thursday. What about the euro?
The U.S. dollar traded in the red today. Its index tumbled by 0.1% to 103.67 after skyrocketing to a six-week peak of 104.11 on Wednesday. U.S. economic data came out stronger than market players expected. This news brought an optimistic mood to the market, with investors hoping the global economy would grow instead of decline. While the U.S. Federal Reserve still seems set to hike its interest rates, that didn’t deter traders from buying the riskier currencies.
On Wednesday, the U.S. Commerce Department reported that U.S. retail sales soared in January, rebounding after two consecutive months of decreases. People purchased big-ticket items, such as motor vehicles and other goods.
Moreover, U.S. job growth was robust last month. That indicates that the American economy is still resilient. But some analysts fear that it will move into a recession if the Fed continues its aggressive policy.
Christopher Wong, the currency strategist at OCBC, noted that U.S. data is much better than forecast and should support the global growth picture. Moreover, China’s reopening might also play a significant part in the global economic recovery.
How are the other major currencies faring?
The euro surged forward by 0.2% versus the weakened dollar. It exchanged hands at $1.07095 after plunging to six-week lows earlier this week. Despite its losses, the currency is still 11.5% higher compared to the 20-year low hit in September.
Meanwhile, the British Pound jumped by 0.21% to $1.2064. The sterling had also traded in the red on Wednesday, losing more than 1%. According to the new report, U.K. inflation slowed considerably in January. The Bank of England hinted that it might stop hiking rates in March.
On Thursday, the Japanese Yen rallied broadly. It jumped by 0.3% to 133.73 USD. Moreover, the Yen gained 0.1% to 143.16 versus the euro. Investors are waiting for Kazuo Ueda’s speech. He is likely a candidate to become the Bank of Japan’s next governor.
In Asia, the Australian dollar soared by 0.3% to $0.6929 today, thanks to the risk-on mood. At the same time, the New Zealand dollar climbed up by 0.34% to $0.6302. However, it still traded near the six-week low of $0.6253 hit in the previous session.
Furthermore, China’s offshore yuan remained firm at 6.864 to USD. However, the Philippine peso continued rallying. It gained the most among its peers today, adding 0.5% overall. The Indonesian rupiah also rose by 0.3%. Meantime, the Singapore dollar added 0.2%, with the Indian rupee jumping by the same amount. The Taiwan dollar increased by 0.1%, as well.
