The index dollar traded slightly lower, marking its biggest weekly decline since mid-December, with a decline of more than 1% against a basket of six major currencies.
He euro fell 0.06% to $1.09425. The European currency hit an eight-week high early in the session and was up almost 1% for the week, its best weekly performance against the greenback since the week ending December 22.
He and in hit five-week highs against dollar, prompted by reports that the Bank of Japan is considering raising rates and establishing a new quantitative monetary policy framework. The dollar fell 0.68% to 147.05 yen, its weakest level since February 2.
The president of the United States Federal Reserve (Fed), Jerome Powell, appeared more confident in cutting interest rates in the coming months. He said the Fed is “not far” from the confidence needed to reduce them. Currencies tend to weaken if central banks cut rates.
The key information of this day is the report on the employment in United States. Employment growth accelerated in February, with nonfarm payrolls increasing by 275,000 jobs, compared to an expected increase of 200,000. However, data for January was revised downward to show that 229,000 jobs were created.
The rate of unemployment rose to 3.9% in February after remaining at 3.7% for three consecutive months, while wage growth slowed to 0.1% monthly.
“A report in line with the 200,000 consensus for nonfarm payrolls growth would certainly keep the Fed in their holding pattern,” said Padhraic Garvey of ING to Reuters. “The data will be decisive in determining the direction of the markets in the future, but it seems that the rates markets have been preparing for a much weaker number,” she added.
As the euro weakens against the dollarthere were indications that the governing council of the European Central Bank (ECB) had begun to debate an appropriate timetable for monetary policy easing. On Thursday, the ECB kept rates at their record level of 4%, while cautiously laying the groundwork for lowering them later in the year, saying it had made good progress in reducing inflation.
Stock markets hit all-time highs
Global stocks were trading at all-time highs given this context. The world stock index MSCI improved 0.2%, close to the all-time high of 774.66 points reached earlier in the session. The pan-European STOXX 600 It gained 0.15%, to 503.92 units, the highest level in its history.
“We find ourselves facing a dilemma, with very solid macroeconomic conditions, disinflationthe impending monetary turnaround, solid earnings growth and enthusiasm for the artificial intelligence“said Patrick Spencer of R. W. Baird. “On the other hand, there is an unattractive technical evolution, with a feeling of euphoria and sky-high prices in the technology sectorbut I suspect that as rates go down, the breadth of the market will improve,” he said.
He S&P 500 and the Nasdaq hit intraday record highs on Friday, after data showing a rise in the unemployment rate and a moderation in wage increases, bolstering expectations that the Federal Reserve could begin cutting interest rates by the middle of this year. anus.
In Asia Expectations have risen that the Bank of Japan will finally abandon negative rates this month. This boosted the yen, which hit its highest level in a month against the dollar, and pushed up domestic bond yields, while the Nikkei gained 0.23%.
Chinese stocks improved 0.4% and the Shanghai Composite Index gained 0.6%. However, both measures closed the week with marginal gains. He Hang Seng Hong Kong rose 0.7%.
Hopes for rate cuts put downward pressure on US government bond yields. The return of the treasury notes The two-year bond, which usually reflects short-term rate expectations, fell to 4.4944%, and the 10-year benchmark paper was trading at 4.0749%.
Source: Ambito
