An interesting close to the week for the dollar, with US Gross Domestic P figures falling in line with forecasts at 2.6%, causing little excitement for investors. If anything, this weakened the dollar slightly, especially when coupled with the US Senate’s failure to pass the repeal bill of the 2010 Affordable Care Act on Thursday night.
Further to this, the International Monetary Fund said on Friday the dollar was overvalued by 10 to 20%. Could the appreciation we’ve seen in recent years be over for the dollar? Overall, the euro has increased by almost 3% this month and in excess of 11.5% year-to-date against the dollar.
Looking to the week ahead, we’ll be hearing manufacturing data and personal consumption expenditure but it’s US employment figures that will take centre stage. We expect to see a further strong rise with forecasts coming in at 175,000. Hopefully this will provide some clarity towards potential changes in US monetary policy later in the year.
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