Dollar Index Edges Up As Markets Eye Vote And Fed

RTTNews | 20 दिनों पहले
Dollar Index Edges Up As Markets Eye Vote And Fed

(RTTNews) - Currency market movements during the week ended November 1 were dominated by uncertainty surrounding the U.S. Presidential election as well as the Fed's impending interest rate review. The U.S. Dollar gained against the British pound, the Australian Dollar, the Japanese yen, the Canadian Dollar, the Swedish Krona, and the Swiss franc but slipped against the euro during the week spanning October 28 to November 1.

The Dollar Index, a measure of the Dollar's strength against a basket of currencies comprising the euro, the British pound, the Japanese yen, the Canadian Dollar, the Swedish Krona, and the Swiss franc closed trading at 104.28 on November 1 versus 104.26 a week earlier. The week's trading range was much wider, oscillating between the high of 104.64 recorded on Tuesday and the low of 103.68 recorded on Friday. The Dollar's strength came amidst mixed economic data released during the week.

Data released on Tuesday showed the number of job openings decline to 7.44 million in September from a downwardly revised 7.86 million in August and below market expectations of 7.99 million.

Advance estimate released by the U.S. Bureau of Economic Analysis on Wednesday showed the American economy expanding at an annualized 2.8 percent in the third quarter of 2024, below the 3 percent growth achieved in the second quarter. Markets had anticipated a growth of 3 percent in the recent quarter also.

In the PCE-based inflation readings released on Thursday, the annual/monthly PCE price Index matched market expectations. Though the month-on-month core component also matched market expectations, the core component on a year-on-year basis did not decline as was expected by the markets.

Data released by the U.S. Bureau of Labor Statistics on Friday morning showed addition to non-farm payrolls declining to 12 thousand in October from 223 thousand in the previous month. Markets had expected an addition of 113 thousand given the effect of hurricanes as well as the strike at Boeing. The unemployment rate was however steady at 4.1 percent as expected.

The ISM Manufacturing PMI released on Friday unexpectedly declined to 46.5. Markets had expected the same to rise to 47.6 from 47.2 in the previous month.

Despite the mixed economic data, markets continued to expect a rate cut of 25 basis points in the Fed review on November 7. Amidst the election frenzy, yields on ten-year U.S. treasuries oscillated between 4.388 percent and 4.198 percent over the course of the week.

The U.S. dollar slipped 0.38 percent against the euro during the week ended November 1 amidst a larger than expected spike in inflation in the Euro Area that boosted the euro. From the level of 1.0793 on October 25, the EUR/USD pair rallied to 1.0834 by November 1. The weekly trading ranged between the low of 1.0768 recorded on Tuesday and the high of 1.0905 touched on Friday.

Data released on Thursday had shown annual inflation in the Euro Area accelerating to 2 percent in October, from 1.7 percent in September which was the lowest level since April 2021. Markets which had expected the reading to increase to 1.9 percent only are now gearing for a cautious interest rate strategy by the European Central Bank. Strong rate cut expectations from the Bank of England amidst a larger-than-expected decline in inflation caused the sterling to drop 0.25 percent against the greenback during the week ended November 1. The GBP/USD pair declined to 1.2926 on November 1, from 1.2959 a week earlier. The sterling's weekly trading range was between $1.3043 recorded on Wednesday and $1.2841 recorded on Thursday. Bank of England is widely expected to deliver a 25-basis points rate cut on Thursday.

A larger-than-expected decline in consumer price inflation contributed to the Australian Dollar's decline against the greenback during the week ended November 1. Data released by Australian Bureau of Statistics on Tuesday showed the monthly Consumer Price Index Australia increasing by 2.1 percent year-on-year in September 2024, versus market forecasts of 2.4 percent and August's level of 2.7 percent. However, the Reserve Bank of Australia is not seen cutting rates in the review on Tuesday.

The AUD/USD pair tumbled 0.67 percent during the week spanning October 28 to November 1. From the level of 0.6603 recorded on October 25, the pair dropped to 0.6559 in a week's time. The pair touched a high of 0.6624 on Monday and a low of 0.6534 on Wednesday.

The USD/ JPY pair rallied 0.45 percent during the week ended November 1 as it closed at 152.98 versus 152.30 a week earlier. The pair ranged between the high of 153.87 on Monday and the low of 151.77 on Friday. The yen plunged in the aftermath of the elections in Japan that saw Prime Minister Shigeru Ishiba's coalition lose its parliamentary majority and triggering political instability. However, a hawkish message from Bank of Japan limited losses.

Anxiety ahead of the closely fought presidential election in the U.S. and the potential Fed rate cut continue to hold formidable influence over the currency market. The Dollar Index has dropped to 103.66 from the level of 104.28 recorded at close on Friday.

Amidst the Dollar's weakness, the EUR/USD pair rallied to 1.0905 whereas the GBP/USD pair increased to 1.2965. Ahead of the Reserve Bank of Australia's interest rate decision on Tuesday, the AUD/USD pair has rallied around half a percent to 0.6602. Ahead of the release of the Bank of Japan's meeting minutes on Tuesday, the USD/JPY pair slipped to 151.78.

With elections getting closer and closer, the focus of the currency market would soon be on potential post-election volatility, Federal Reserve's rate decision as well as its forward guidance.

read more
Asian Markets Track Wall Street Higher

Asian Markets Track Wall Street Higher

Asian stock markets are trading mostly higher on Monday, following the broadly positive cues from Wall Street on Friday, boosted by strong gains in markets in Japan, Indonesia and South Korea as traders remain optimistic about a 25-basis point rate cut by the US Fed in December after data showing consumer sentiment in the U.S. improved less than expected in November.
RTTNews | 5घंटे 4 मिनट पहले
Sensex, Nifty Set For Gap-up Opening

Sensex, Nifty Set For Gap-up Opening

Indian shares may see a gap-up opening on Monday after BJP-led alliance scored significant victory in the Maharashtra state assembly elections, raising expectations for increased government spending to boost domestic demand.
RTTNews | 6घंटे 2 मिनट पहले
Japanese Market Sharply Higher

Japanese Market Sharply Higher

The Japanese stock market is trading sharply higher on Monday, adding to the gains in the previous session. The benchmark S&P/ASX 200 is moving above the 38,900 level, following the broadly positive cues from Wall Street on Friday, with gains across most sectors led by index heavyweights, financial and technology stocks after recent data showed headline inflation slowing to a nine-month low.
RTTNews | 6घंटे 11 मिनट पहले
Thai Stock Market Expected To Open In The Green On Monday

Thai Stock Market Expected To Open In The Green On Monday

The Thai stock market rebounded on Friday, one day after snapping the three-day winning streak in which it had gathered more than 20 points or 1.5 percent. The Stock Exchange of Thailand now sits just above the 1,445-point plateau and it's tipped to open to the upside again on Monday.
RTTNews | 6घंटे 32 मिनट पहले
Indonesia Stock Market May Add To Its Winnings On Monday

Indonesia Stock Market May Add To Its Winnings On Monday

The Indonesia stock market on Friday ended the two-day losing streak in which it had slumped almost 55 points or 0.8 percent along the way. The Jakarta Composite Index now rests just beneath the 7,200-point plateau and it's expected to open in the green again on Monday.
RTTNews | 7घंटे 2 मिनट पहले
Australian Market Notably Higher

Australian Market Notably Higher

The Australian stock market is currently trading notably higher on Monday, adding to the gains in the previous session, following the broadly positive cues from Wall Street on Friday. The benchmark S&P/ASX 200 index is moving above the 8,400.00 level, with gains across most sectors led by mining, energy and technology stocks. Financial stocks are the only weak spot.
RTTNews | 7घंटे 16 मिनट पहले
Hong Kong Shares Due For Support On Monday

Hong Kong Shares Due For Support On Monday

The Hong Kong stock market has moved lower in two straight sessions, dropping more than 470 points or 2.5 percent along the way. The Hang Seng Index now sits just beneath the 19,230-point plateau although it may stop the bleeding on Monday.
RTTNews | 7घंटे 17 मिनट पहले
China Stock Market May Cut Into Friday's Losses

China Stock Market May Cut Into Friday's Losses

The China stock market on Friday halted the three-day winning streak in which it had advanced more than 35 points or 1 percent. The Shanghai Composite now sits just beneath the 3,270-point plateau although it's likely to make back some of that on Monday.
RTTNews | 7घंटे 32 मिनट पहले