Jackson Hole Fears And Cues Drive The Dollar's Surge

RTTNews | 651天前
Jackson Hole Fears And Cues Drive The Dollar's Surge

(RTTNews) - The Jackson Hole Economic Symposium and the anxiety about Federal Reserve Chair Jerome Powell's commentary thereat was the overwhelmingly predominant theme for currency markets during the week spanning August 21 to 25. The U.S. dollar strengthened substantially against the euro, the British pound, and the Japanese yen, and mildly versus the Australian dollar.

Jerome Powell, in his speech on Friday reiterated that the Fed remained focused on bringing inflation to the level of 2 percent but assured to proceed carefully. The hints triggered fears of interest rates remaining higher for longer, giving a fillip to the greenback in the currency market.

The Dollar Index which measures the dollar's strength against a basket of six currencies gained close to 0.7 percent during the week ended August 25. The index rose from 103.38 at the end of the previous week to close the recent week at 104.08.

The decline of Manufacturing and Services PMI readings for August triggered a mid-week weakness in the greenback. New orders for manufactured durable goods in the U.S. plummeting more than expected also weakened the sentiment. However, the more-than-expected hawkishness on display by the Fed Chair at the Jackson Hole speech on Friday, revived the Dollar's fortunes. The spike in bond yields also supported the Dollar's rally. The week's trading range was between the high of 104.45 touched on Friday and the low of 103.01 touched on Tuesday.

A more-than-expected decline in producer price inflation in Germany and the weak PMI readings from the region diminished the prospects of an aggressive rate hike by the ECB. At the same time, the Fed continuing with hints of rate hikes, dragged the EUR/USD pair 0.60 percent lower during the week ended August 25. From the level of 1.0865 on August 18, the pair dropped to 1.08, after steadily dropping from the high of 1.0932 on Tuesday to the low of 1.0766 on Friday.

The pound's weakness following the decline in inflation, the deceleration in PMI readings for both the manufacturing and services sectors and the Fed's persisting aggressiveness caused the GBP/USD pair to decline 1.2 percent during the week spanning August 21 to 25. The pound which was last traded at $1.2730 on August 18 closed on August 25 at $1.2577. The week's trading range for the pair was between a high of 1.2802 and a low of 1.2548.

The Aussie more or less resisted the U.S. dollar's strength, closing flat at 0.6400 versus 0.6402 a week earlier amidst lackluster PMI readings. The AUD/USD pair traded between 0.6489 and 0.6380 during the week.

The Japanese yen shed 0.72 percent against the U.S. dollar during the week ended August 25. The USD/JPY pair closed at 146.41 on August 25 versus 145.37 at the end of the previous week. The pair traded between the low of 144.54 on Wednesday and the high of 146.65 on Friday in a week marked by a major spike in U.S. treasury yields.

Several key economic data releases are due from the U.S. in the upcoming week which could sway the Fed's decision on interest rates. These include data on job openings, the PCE-based inflation readings, the non-farm payrolls reading, the unemployment numbers as well as the manufacturing PMI. Flash inflation readings are due from Germany, France as well as the Euro Area. PMI readings from China are also due during the week which could provide an update on the health of the manufacturing sector.

Amidst the anxiety, the Dollar Index has moved to 104.07. The EUR/USD pair has edged higher to 1.0804 whereas the GBP/USD pair is trading higher at 1.2589. The AUD/USD pair is currently at 0.6417. The USD/JPY pair has increased to 146.51.

read more
Australia NAB Business Conditions Ease; Confidence Improves

Australia NAB Business Conditions Ease; Confidence Improves

Australian business conditions eased in May amid ongoing profitability pressures and soft demand, while business confidence improved from the last month, survey data from NAB showed on Tuesday. A monthly survey conducted by Westpac showed that consumer confidence rose moderately in June, underpinned by interest rate cut and softening inflation.
RTTNews | 29分钟前
European Economic News Preview: UK Unemployment Data Due

European Economic News Preview: UK Unemployment Data Due

Unemployment from the UK and industrial production from Italy are the top economic news due on Tuesday. At 2.00 am ET, the Office for National Statistics releases UK unemployment data. The jobless rate is forecast to fall to 4.6 percent in three months to April from 4.5 percent in the preceding period.
RTTNews | 1小时27分钟前
Australian Market Doubles Early Gains In Mid-market

Australian Market Doubles Early Gains In Mid-market

The Australian stock market is doubling its early gains in mid-market trading on Tuesday, reversing some of the losses in the previous two sessions, following the mixed cues from Wall Street overnight. The benchmark S&P/ASX 200 is moving up to near the 8,600 level, with gains in iron ore miners, financial, technology and energy stocks partially offset by weakness in gold miners.
RTTNews | 2小时14分钟前
Asian Markets Trade Mostly Higher

Asian Markets Trade Mostly Higher

Asian stock markets are trading mostly higher on Tuesday, following the mixed cues from Wall Street overnight, amid easing trade war tensions between the US and China after the two superpowers began high-level trade talks in London, with negotiations expected to continue on Tuesday. The tariff war between the two countries has already rattled the global economy.
RTTNews | 2小时56分钟前
Sensex, Nifty Seen Higher At Open As Sino-US Talks Continue

Sensex, Nifty Seen Higher At Open As Sino-US Talks Continue

Indian shares look set to open on a positive note Tuesday as top officials from the U.S. and China continue their trade talks for a second day today to resolve their differences and ease tensions over rare-earth minerals and technology shipments.
RTTNews | 3小时23分钟前
Thai Bourse May Extend Losing Streak

Thai Bourse May Extend Losing Streak

The Thai stock market has ticked lower in back-to-back sessions, slipping more than 5 points or 0.4 percent along the way. The Stock Exchange of Thailand now rests just above the 1,135-point plateau and it may take further damage on Tuesday. The global forecast for the Asian markets is murky ahead of key upcoming talks between the United States and China. The European markets were down and the U.S. bourses were flat and the Asian markets figure to split the difference.
RTTNews | 3小时54分钟前