The US dollar started the week slowly with events few and far between. The currency resisted some negativity from the vice chairman of the US Federal Reserve, as investors looked ahead to later releases with optimism. Events around the globe came in to play mid-week, as both disappointing US data and a bleaker outlook in the UK prompted movements in the markets. A dampening of spirit in the UK saw the dollar strengthen to its best rate in four months against sterling, seeing an increase of 1% across the week. The dollar has had a strong month, rising by over 3% against sterling and 2.5% against the euro, with the question now being: how much further can it climb? Aside from this, retail sales figures were slightly behind expectations to cool some of the speculation over interest rate rises, but unemployment claims stayed steady as they came out as expected.
Today closes out the week with two final influential releases, starting with the Producers’ Price Index, an indication of inflation. Next, the Consumer Sentiment from the University of Michigan will provide a final opportunity for the dollar to see some movement.