Published December 3, 2023
US DOLLAR FORECAST – EUR/USD, USD/JPY, GBP/USD
- The U.S. dollar has fallen sharply in recent weeks
- The greenback’s bearish correction may extend if November U.S. job data surprises to the downside
- This article examines the technical outlook for the major U.S. dollar pairs, analyzing critical price levels that could be relevant for EUR/USD, USD/JPY and GBP/USD
The U.S. dollar, as measured by the DXY index, fell nearly 3% in November, weighed down by the downward correction in U.S. yields triggered by bets that the Federal Reserve has finished raising borrowing costs and would move to sharply reduce them in 2024 as part of a strategy to prevent a hard landing.
While some Fed officials have been dismissive of the idea of aggressive rate cuts in the near future, others have not entirely ruled out the possibility. Despite some mixed messages, policymakers have been unequivocal about one aspect: they’ll rely on the totality of data to guide their decisions.
Given the Fed’s high sensitivity to incoming information, the November U.S. employment report, due for release next Friday, will take on added significance and play a critical role in the formulation of monetary policy at upcoming meetings.
In terms of estimates, non-farm payrolls (NFP) are expected to have grown by 170,000 last month, following an increase of 150,000 in October, resulting in an unchanged unemployment rate of 3.9%. For its part, average hourly earnings are seen rising 0.3% m-o-m, with the related yearly reading easing to 4.0% from 4.1% previously.
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SOURCE: www.dailyfx.com
RELATED: US Dollar closes a third consecutive losing week, focus shifts to employment data
Published December 1, 2023
- The DXY Index is seen with losses around 103.15, after reaching a high of 103.70, above the 200-day SMA.
- Fed Chair Powell warned that the bank will hike again if needed, keeping its data-dependency approach.
- The US ISM Manufacturing PMI declined in November, as expected.
- Next week, the US will release November’s Nonfarm Payrolls report.
The US Dollar (USD) Index has shown a modest decline, trading at 103.15, despite Federal Reserve Chair Jerome Powell’s hawkish stance. The November ISM Manufacturing PMI came in lower than expected but didn’t trigger any significant downward movements in the Greenback. What seems to weaken the currency is that markets aren’t buying Powell’s hawkishness.
In line with that, despite cooling inflation and a mixed trend in the United States labour market, the Fedturned surprisingly less dovish, maintaining an open stance toward further policy tightening. While important gauges of inflation like the Consumer Price Index (CPI) and Personal Consumption Expenditures (PCE) have trended lower, the bank has declared that it needs to see more evidence of inflation cooling down, leaving the door open for further tightening if needed.
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SOURCE: www.fxstreet.com
RELATED: Dollar soft as traders weigh Fed rate cut prospects
Published December 1, 2023
SINGAPORE -The dollar dipped on Friday, while the euro edged higher after steep overnight losses as traders weighed data that showed inflation was easing, stoking expectations that interest rates had peaked and central banks would soon start cutting rates.
The dollar index, which measures the U.S. currency against six rivals, was 0.116 percent lower at 103.33, after clocking its weakest monthly performance in a year in November, despite a 0.6 percent jump overnight.
Data on Thursday showed U.S. consumer spending rose moderately in October, while the annual increase in inflation was the smallest in more than 2-1/2 years.
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SOURCE: www.business.inquirer.net
RELATED: BRICS: Less Than 10% Of Russian Oil Sold In US Dollars
Published December 1, 2023
The White House pressed sanctions against Russia in February 2022 for its role in invading and waging war against its neighboring country Ukraine. The Russian economy came to a standstill as it struggled to conduct business with other countries without the US dollar. However, BRICS came to the rescue of Russia, as the alliance kick-started the de-dollarization initiative and began using local currencies for crude oil payments sidelining the US dollar.
BRICS members China, India, Saudi Arabia, and the UAE, among others, paid the Chinese Yuan for Russian oil and not the US dollar. Russia is now exporting crude oil to BRICS and other developing countries without accepting the US dollar as payment. The majority of the cross-border transactions are settled in local currencies like the Chinese Yuan and Ruble.
Additionally, Saudi Arabia procured cheap Russian oil and also laundered it throughout Europe. Russian crude oil is now available at discounted prices due to the sanctions and other countries are making the most out of it. India saved $7 billion a year by paying in local currencies for oil and not the US dollar.
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SOURCE: www.watcher.guru
