020 7898 0500The week could not have gone any worse for the US dollar. The driver seems to be that markets are no longer convinced the Federal Reserve will raise interest rates by the middle of this year. Inflation has taken a tumble as energy costs fall and the strong dollar has impacted exports increasing the trade balance deficit to exceed expectations and hit an eight month low.
Other data has disappointed. On Wednesday we had lower-than-forecasted employment change, a leading indicator for the all-important non-farm employment change out today. Also today we have the earnings growth figure which disappointed in December and is important in determining the affordability of an interest rate rise and the ability of consumers to pay the additional cost.
