US Dollar Takes Off Strong After Important Data and Fed Comments By

© Reuters. – Updated at 13:00 GMT

Michigan Consumer Confidence came in below expectations, coming in at 57.7 vs. 63.0 expected.

The dollar index now records 102.350 after the data showed that the Fed’s policy is bearing fruit, and may continue to tighten monetary policy.

The American rebounded today, and recorded at 11:12 GMT the level of 101.903.

After the Fed’s members stated that the rate path is still dependent on inflation, and that inflation is still above the Fed’s target.

Follow the statements:

Data released Thursday showed that the number of Americans filing for unemployment benefits jumped to a 1-1/2 year high last week, while the index rebounded modestly in April.

This indicates that the US has halted the tightening cycle in June, an outlook that affected the dollar for most of the year.

However, the dollar got a boost on Thursday, with the index climbing to its highest level since May 2, due to uncertainty surrounding a US debt ceiling hike.

A meeting between US President Joe Biden and senior lawmakers on the topic that was to be discussed on Friday has been postponed, and the US federal government may run out of money and not be able to pay its bills by June 1 unless the debt ceiling is raised.

“The dollar rebound seen yesterday was the result of some squared-off and less-than-consensus data,” analysts at ING said in a note, while a risk environment that remains unstable due to recession fears and the US debt ceiling crisis continues to create fertile ground for further growth. of defensive positions in forex.”

Elsewhere, it rose 0.2% to 1.2535, bouncing back after data showed UK growth of 0.1% in the first three months of 2023, despite unexpectedly sharply declining 0.3% in March.

He raised interest rates by 25 basis points on Thursday, the 12th consecutive increase in the interest rate as he tries to combat inflation that remains in the double digits.

ING added, “Although we are not ruling out a recent rally in June, the fundamental case suggests that we have reached the peak of the BoE’s tightening cycle as inflation will start to slow rapidly this year.”

The currency pair rose 0.2% to 1.0930, and rose 0.2% to 134.83, with the yen adjusting for small weekly gains on safe-haven demand, while the currency pair fell 0.1% to 0.6694.

The currency pair fell to 6.9463, but remained close to the psychologically important level 7 against the dollar amid doubts about the strength and speed of the Chinese economy’s recovery.