Dollar dominates after retail sales rise

Texas News Today

FILE PHOTO: The US$1 bill is displayed before the stock price graph displayed in this figure taken on February 8, 2021. Reuters / Dado Ruvik / Illustration

September 17, 2021

Hideyuki Sano

TOKYO (Reuters) – The dollar held a nearly three-week high against a basket of major currencies on Friday after a strong US economic data raft rekindled hopes of a previous Fed tightening. ..

US retail sales were expected to drop 0.8% but unexpectedly rose in August, up 0.7% from the previous month. The Corporate Psychology survey by the Philadelphia Federated Bank also saw a significant improvement.

“Yesterday’s data was pretty strong overall,” said Yujiro Goto, chief currency strategist at Nomura Securities. “The market was concerned that the Delta version could undermine consumption in August, but retail sales were surprisingly strong.”

The numbers help curb a cautious outlook of the US economy, which picked up earlier this month after weak data on low consumer inflation and job growth, and the Fed’s expectation of an early contraction. It helped to revive.

The dollar index was at 92.880, close to Thursday’s three-week high of 92.965.

The euro hit a three-week low of $1.17505 overnight and finally traded at $1.1765.

The common currency also recovered some losses after hitting a three-week low of 128.61 yen and a one-month low of £0.8501.

The stronger dollar was most noticeable against other safer assets such as the Swiss franc and precious metals.

The Swiss franc fell 0.89% on Thursday, hitting a five-month low of 0.92785 against the dollar.

Gold was at $1,754.4 an ounce after falling 2.3% in the previous session, but silver was trading 3.7% lower at $22.88 an ounce on Thursday, near an eight-month low in August. I returned to

The dollar rose 0.34% on Thursday, down from Wednesday’s six-week low of 109.11 and returned to 109.72 yen.

The yen has so far responded in a limited way to the Liberal Democratic Party’s (LDP) leadership race decision, which officially begins on Friday before the September 29 vote. The parliamentary rule of the LDP means that the new leader of the party will become the prime minister.

Many investors consider Taro Kono to be the prime candidate, followed by former Foreign Minister Fumio Kishida and former Interior Minister Sane Takachi.

Credit Suisse vice chairman and chief economist Hiromichi Shirakawa said, “The world’s biggest macro players do not expect a major policy shift.

Still, former Interior Minister Seiko Noda’s decision to run in the race on Thursday could mean that not a single candidate could win in the first round and the election would proceed to a final vote. , increased uncertainty.

Elsewhere, sterling fell to $1.3795 while the Australian dollar was trading at $0.7294 after touching a three-week low of $0.7274 in the previous session.

The yuan licked its wounds after falling 0.4% on Thursday.

In the offshore transaction, investors worried that real estate giant China Evergrande may neglect to pay coupons next week, thus leading to a final yuan of $6.4530 due to growing concerns over China’s real estate sector. It was a business.

Bitcoin is down from this week’s high, with Bitcoin trading at $47,663 and Ether trading at $3,552.

(Reporting by Hideyuki Sano, edited by Sam Holmes)

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