The U.S. dollar index rose on Thursday (22nd), after earlier data showed that a strong labor market may keep the Federal Reserve (Fed) in a hawkish stance for a longer period of time. The Russian ruble rallied more than 6 percent against the dollar, rebounding from seven-month lows.
In late U.S. trade, the ICE U.S. Dollar Index (DXY), which tracks the greenback against six major currencies, was up 0.22% at 104.39.
The United States announced on Thursday that the number of people filing for unemployment benefits for the first time last week increased slightly less than expected, but it was still at a low point, indicating that the labor market remains tight. to 3.2%.
A solid labor market prompted the Fed to aggressively tighten monetary policy. The Fed last week estimated that borrowing costs would increase by at least 75 basis points by the end of 2023. It has raised policy interest rates by 425 basis points this year from near zero to a range of 4.25%-4.5%, the highest level since the end of 2007. Highest.
Karl Schamotta, chief market strategist at Corpay, said better-than-expected economic data had raised interest rate expectations and led to a stronger dollar. He believes that there is currently no evidence that the decision to raise interest rates has helped achieve “sustained below-trend economic growth”, so the Fed may be forced to continue raising interest rates.
The euro rose as much as 0.5 percent against the dollar before paring gains and was last down 0.1 percent at $1.0594. The dollar also edged down 0.1% against the yen to 132.34 yen, not far from the four-month low set on Tuesday (20th).
Michael Brown, an analyst at Trader X, is optimistic that there is room for a sharp appreciation of the yen against the dollar. He believes that as the Bank of Japan becomes more hawkish and the market doubts the message from the Fed, the yen is expected to rise to 125 to 126 against the dollar level of the yen.
Sterling fell to a three-week low against the dollar, shedding 0.37% to $1.2037. Earlier data showed that the UK economy shrank by 0.3% in Q3, beating market expectations.
The Russian ruble surged more than 6% to 67 per dollar, paring some of the week’s losses. The ruble fell to a seven-month low in recent days, weighed down by oil and gas sanctions imposed by Western countries, but the tax outlook at the end of the month helped ease concerns about Western sanctions.
Russia plans to buy yuan on the market starting in 2023, resuming yuan-denominated interventions to reduce reliance on the U.S. dollar and the Western financial system if oil and gas revenues meet government expectations, according to Reuters.
The dollar rose 0.3 percent against the offshore yuan to 7.006 yuan on Thursday, its strongest since the beginning of the month.
As of about 7:00 Taiwan time on Friday (23rd) Price:
The dollar index was at 104.39. +0.22% The euro was quoted at 1.0596 dollars to the euro against the dollar (EUR/USD). -0.07% The British pound was trading at 1.2037 per dollar (GBP/USD). -0.37% The Australian dollar was trading at 0.6667 Australian dollar to the US dollar (AUD/USD). -0.59% The U.S. dollar was trading at 1.3652 Canadian dollars to the U.S. dollar. +0.31% The U.S. dollar was trading at 132.30 yen to the U.S. dollar. -0.12%
