The US dollar endured a tough week as it battled long time lows, particularly against sterling. The start of the week saw strength from the UK, which drove the dollar to its lowest point against sterling since November 2009. However, the US currency fought back a little thanks to improved pending home sales data. Markets were then tentative ahead of Wednesday’s key releases, which provided some significant movements. Firstly, stagnating growth data caused the dollar to tumble again, but this was counteracted a little later on as the independent non-farm and Chicago Purchasing Managers’ Index (PMI) were both ahead of predictions. Another key event was the US Federal Reserve’s latest meeting, but that had little impact as reports were in line with expectations. Yesterday saw the lows against sterling extended further, to the worst since August 2009 as sterling continued to impress. US data failed to have significant impact, despite worse-than-expected unemployment data.
Today, however, holds more influential labour data in the form of the official non-farm employment change figure and overall unemployment rate. Therefore we should expect lots of movement for the US dollar today, thereby finishing off a busy week with a flourish.
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