The US dollar rose on Friday after data showed inflation rose in March, although at a slower pace, with the Federal Reserve still firmly on track to raise interest rates at next week’s monetary policy meeting.
Meanwhile, the yen fell across the board after the Bank of Japan said it would keep ultra-low interest rates as expected, and unanimously agreed to make no changes to its yield curve control (YCC) policy. decided.
The Japanese currency fell to its lowest level since September 2008 against the euro, and its weakest level in seven weeks against the dollar.
The euro was up 1.5% against the yen at 150. For the week, Europe’s single currency rose 1.8%.
On the other hand, the dollar was last trading up 1.7% at 136.235 yen, its best weekly performance since late February after a weekly gain of 1.6%.
The dollar index, a measure of the greenback’s value against six major currencies, rose 0.2% to 101.65.
Friday’s data showed that the personal consumption expenditure (PCE) price index edged up 0.1% in March after rising 0.3% in February. In the 12 months to March, the PCE price index rose 4.2% after climbing 5.1% in February.
The PCE price index, excluding volatile food and energy components, rose 0.3% after rising at the same rate in February. The so-called core PCE price index rose 4.6% on a year-on-year basis in March after rising 4.7% in February. The Fed tracks the PCE Price Index to its 2% inflation target.
“You probably need a pretty big slowdown in growth for the Fed to be comfortable that it has succeeded in its mission; It’s not there yet,” said Joseph Levorgna, chief U.S. economist at SMBC Nikko Securities in New York. “That doesn’t change the outlook (for policymakers next week).”
After the inflation data, there is a 90% chance of a 25 basis-point hike in the rate futures market next week.
A separate report on Friday showed final University of Michigan consumer sentiment rose from a three-month low of 62 in March to 63.5 in April, adding to the dollar’s gains. US consumers’ one-year inflation outlook was up 4.6 this month from 3.6 in March, easing expectations of further rate hikes that also boosted the dollar.
Meanwhile, the euro fell 0.1% to $1.1017 against the dollar.
Economic data painted a mixed picture for growth and inflation across the euro area, adding to uncertainty about the size of the European Central Bank’s expected interest rate hike next week.
Preliminary data showed gross domestic product in the euro area rose 0.1% in the first quarter, below expectations of 0.2% in a Reuters poll.
The single European currency fell heavily earlier in the session but pared losses as investors sold the yen against the euro. It spread on the Euro/Dollar cross.
“We think the balance of probabilities is slowly shifting in favor of the dollar,” Jonathan Peterson, senior markets economist at Capital Economics, wrote in a research note.
“The ‘Goldilocks’ reign of strong activity data out of the US appears to be fading, and we expect the dollar to benefit from safe haven demand as the global growth picture begins to deteriorate further in the coming months.”
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Currency Quote Price at 3:26 PM (1926 GMT)
Details RIC Last US Close PCT Change YTD PCT High Bid Low Bid
last change
Session
Dollar Index 101.6400 101.4500 +0.20% -1.788% +102.1700 +101.4200
EUR/USD $1.1018 $1.1029 -0.10% +2.83% +$1.1045 +$1.0963
USD/JPY 136.2350 134.0100 +1.66% +3.91% +136.5600 +133.3600
EUR/JPY 150.00 147.77 +1.51% +6.91% +150.4300 +147.2300
Dollar/Swiss 0.8936 0.8944 -0.07% -3.34% +0.8975 +0.8896
Sterling/Dollar $1.2563 $1.2500 +0.50% +3.88% +$1.2584 +$1.2447
Dollar/Canadian 1.3547 1.3591 -0.32% -0.01% +1.3668 +1.3536
Aus/Dollar $0.6615 $0.6630 -0.22% -2.95% +$0.6642 +$0.6573
Euro/Swiss 0.9846 0.9862 -0.16% -0.50% +0.9868 +0.9816
Euro/Sterling 0.8769 0.8824 -0.62% -0.85% +0.8839 +0.8768
NZ $0.6184 $0.6148 +0.59% -2.61% +$0.6187 +$0.6124
dollar/dollar
Dollar/Norway 10.6650 10.6210 +0.44% +8.70% +10.7690 +10.6290
Euro/Norway 11.7497 11.7106 +0.33% +11.97% +11.8338 +11.6981
Dollar/Sweden 10.2563 10.2857 -0.46% -1.46% +10.3522 +10.2405
EUR/Sweden 11.3011 11.3530 -0.46% +1.36% +11.3720 +11.3010
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