The dollar is set to end the week in the red, losing 0.6% on the day against its rivals. The dollar is widely expected to weaken this year.
As the Federal Reserve turns more cautious about rate increases, the dollar will probably edge lower this year.
On Wednesday, the U.S. central bank held interest rates steady as expected. However, FED discarded pledges of “further gradual increases” in interest rates.
Broader risk sentiment remained somewhat robust after a top U.S. negotiator reported “substantial progress” of trade high-level talks with China. Market participants closely track high-level trade talks between the United States and China that be.
Markets also focus on U.S. jobs data later on Friday. Analysts note that any weakness in the labour market and a fall in wage inflation would only reinforce the dovish outlook for the dollar this year.
START TRADINGNon-Farm Payroll
U.S. job growth jumps, as unemployment rate rises to a seven-month high of 4.0%. The report came two days after the Fed signaled its three-year interest rate hike campaign might be ending. Nonfarm payrolls jumped by 304,000 jobs last month, the largest gain since February 2018. But the economy added 70,000 fewer jobs than previously reported in November and December.
January marked 100 straight months of job gains.
Average hourly earnings rose three cents, or 0.1% in January after accelerating 0.4% in December. That lowered the annual increase in wages to 3.2% from 3.3% in December.
Forex – Commodities – Dollar to end the week in the red
The euro rose 0.2% to $1.1474 after having fallen 0.3% in the last session. The single currency has not managed to gain despite broader dollar weakness. Growth and inflation in the euro zone remain weaker than expected.
Sterling, grappling with uncertainty over a deal to avoid a chaotic Brexit, fell 0.3% to a one-week low of $1.3044. Analysts expect the British pound to remain volatile in the coming weeks.
The Australian dollar, a proxy for China risk, was the main victim, falling 0.5% to 0.7237.
Sources: Reuters, Investing, CNN money
PLEASE NOTE The information above is not investment advice.