Dollar Lifts As Signs Of Solid U.S. Economy Appears, Pound Heightensby Elliot C. Financial Analyst
On Monday, the dollar held steady at the start of a holiday-thinned week in the FX Market. It was after U.S. data has been directing to robust economic growth.
Meanwhile, the British pound rebounded slightly after having experienced its biggest weekly plunge in three years.
A batch of economic data issued last Friday demonstrated the U.S. economy already in its longest expansion in history.
Moreover, it seems to have insisted on the slight pace of expansion as the year ended. The process is supported and made an active labor market.
In a statement, the Commerce Department stated that the Gross domestic product improved at a 2.1% annualized rate.
The rate is in its third assessment of third-quarter GDP that was unrevised from November’s valuation.
A market economist at Sumitomo Mitsui Trust Bank, Ayako Sera, said, “The U.S. economy appears to have stopped slowing. There is no indication it will be hitting a recession.”
Earlier this year, investors have been in fears over the possibility of a U.S. recession. This fear was when the U.S. yield curve reversed, which has been historically one of the most consistent signs of a U.S. downturn.
Last month, separate data revealed consumer spending, which accounts for more than two-thirds of U.S. economic activity.
They have soared 0.4% as households stepped up acquisitions of motor vehicles and spent more on healthcare. The measure has contrasted with a sudden worsening in German consumer sentiment.
Further Forex Market Movements
The euro remained at $1.1077 at the forex trading. It was a little shifted on the day but in retreat since it reached a four-month high of $1.12 on December 13.
On the flip side, the dollar index was at 97.659. It was flat on the day but sustaining its recovery trend since striking a five-month low of 96.605 on December 12.
However, the dollar was buoyed by optimism over the global economy in the foreign exchange market. It was since Washington and Beijing came to a provisional trade deal earlier this month.
Today, China indicated that it would lower tariffs on manufactured goods ranging from frozen pork to a few types of semiconductors next year.
The development is because Beijing looks at boosting imports amid a decelerating economy and a trade conflict with the United States.
Last Saturday, the U.S. President Donald Trump stated that the United States and China would “very shortly” sign up their so-called Phase 1 trade agreement.
The dollar was at 109.41 versus the yen. It was a little shifted on the day and not far from a six-month high of 109.73 marked earlier this month.
Created on Dec 26th 2019 02:48. Viewed 409 times.