August 7, 2022

Dollar Down, Investors Await Further Inflation Data

By Administrator_ India

Capital Sands

The U.S. Dollar Index that tracks the greenback against a basket of other currencies inched down 0.03% to 91.767 by 12:13 AM ET (4:13 AM GMT).

The USD/JPY pair inched down 0.01% to 110.84, with the yen just below a 15-month low against the dollar. Data released earlier in the day said that the Tokyo core consumer price index grew 0% year-on-year in June, while the CPI Tokyo Ex Food and Energy index contracted 0.1% month-on-month in June, which was smaller than May’s 0.4% contraction.

The AUD/USD pair edged up 0.14% to 0.7592 and the NZD/USD pair was up 0.22% to 0.7074. Trade data from New Zealand said that exports and imports stood at a better-than-expected NZD5.87 billion and NZD5.4 billion respectively in May. The trade balance was at –NZD60 million year-on-year while the month-on-month figure was NZD469 million.

The USD/CNY pair inched down 0.10% to 6.4639 and the GBP/USD pair inched up 0.03% to 1.3926.

Investors are still digesting the U.S. Federal Reserve’s surprise hawkish turn as it handed down its policy decision during the previous week, although comments from Fed Chairman and other officials throughout the past week calmed market nerves about an imminent interest rate hike.

The Bank of England’s decision hinted that the central bank was in no hurry to hike interest rates, with officials warning against “premature tightening” as the decision was handed down on Thursday.

Investors also digested U.S. economic data released on Thursday, which said that the GDP rose 6.4% quarter-on-quarter in the first quarter of 2021. However, core durable goods orders rose a smaller-than-expected 0.3% month-on-month in May.

On the employment side, 411,000 initial jobless claims were filed over the past week, higher than the 380,000 claims in forecasts prepared by Investing.com but lower than the 418,000 claims submitted during the previous week.

Further U.S. data on personal spending and the University of Michigan consumer sentiment is due later in the day.

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