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The super dollar fell after an economic data that may have an impact on rates

The super dollar fell after an economic data that may have an impact on rates

The super dollar fell this thursday march 9 after data emerged showing US jobless claims rose more than expected last week, which raised the expectation that a weaker job market managed to prevent the Federal Reserve pick up the pace again rate hikes of interest.

The dollar index fell 0.31% against a basket of currencies to 105.28. The index was down from a three-month high of 105.88 seen on Wednesday.

Initial claims for state unemployment benefits rose 21,000 to a seasonally adjusted 211,000 for the week ending March 4. Economists polled by Reuters had forecast 195,000 applications for the past week.

The data is released before the expected US national employment report for Februarywhich could determine whether or not the Fed raises the benchmark interest rate by 50 basis points at its March 21-22 meeting.

“Many traders are breathing a sigh of relief that we are starting to see some weakness in the labor market,” said Edward Moya, senior market analyst at OANDA in New York, adding: “The fear is that if we get a strong payroll report tomorrow, it will cement rising expectations for a half percentage point rate hike.”

The euro gained 0.31% to $1.0577, and rose from a two-month low of $1.0524 recorded the previous day.

Fed Chairman Jerome Powell on Wednesday reaffirmed his testimony before Congress on Tuesday about the possibility of higher and potentially faster interest rate hikes, but stressed that the debate was still ongoing because the decision that depends of the data that will be issued before the March meeting.

Fed funds rate futures traders are now considering in 66% chance the Fed will raise rates by 50 basis points, up from 22% before Powell’s comments on Tuesday.

Data on Friday is expected to show that employers added 205,000 jobs in February, well below the 517,000 jobs created in January. In addition, it is estimated that wages would rise by 0.3% per month and 4.7% per year.

The dollar fell 0.87% against the Japanese currency to 136,216 yen, hitting a three-month high of 137.90 on Wednesday.

British pound was also one of the best performing currencies on Thursday, gaining 0.58% to $1.1911. having fallen to a more than three-month low of $1.18050 on Wednesday.

Source: Ambito

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