Market Updates: Dollar Steady, Yen Slips Despite GDP Surprise
Investor Anticipation for U.S. Economic Data
The dollar remained stable on Thursday as investors awaited U.S. retail sales and jobless claims data. Meanwhile, the yen saw a decline despite Japan entering a recession.
Dollar Performance and Retail Sales Data
The dollar, measured against six peers, showed a slight dip to 104.64, just below the three-month high of 104.97. Investors are closely monitoring retail sales data, set to be released at 1330 GMT, for insights into the U.S. economy’s trajectory following unexpectedly high inflation figures earlier in the week.
Impact of U.S. Economic Indicators
The recent inflation data led to a shift in expectations for Fed rate cuts, causing a surge in bond yields and the dollar. The dollar’s future trajectory hinges on the U.S. consumer, according to Chris Turner, global head of markets at ING.
European and Asian Economies
The euro remained relatively unchanged at $1.0731, while the pound saw a 0.13% decline to $1.2549 following the UK’s entry into a recession. Despite Japan’s recession, the yen saw a rise, with the dollar down 0.38% at 150.03 yen.
Cryptocurrency and Market Sentiment
Bitcoin experienced a 0.4% increase to $51,970, reaching a 25-month high after the total value invested in bitcoin surpassed $1 trillion. Market sentiment indicates a 44% chance of a Fed rate cut by May, a sharp decline from earlier predictions.
Global Currency Performance
Australia’s dollar remained stable at $0.6493, while the Swiss franc strengthened to 0.8833 francs to the dollar after a period of inflation slowdown. The market also continues to factor in a high likelihood of a Bank of Japan rate hike in April despite negative GDP figures.
