American Dollar falls further as strong wage growth complicates scenario for US Fed



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American Dollar falls further as strong wage growth complicates scenario for US Fed

On Friday, the US Dollar fell against a clutch of major and emerging market currencies as investors remained spooked over US Fed’s rate decision over its December policy meet. In the matter of the fact, a few Fed policymakers made debateable remarks over recent past, as talks were reportedly being held on a slowdown on the US Fed’s aggressive rate-hike cycle, which eventually had spurred up optimism over riskier assets while lassoing down the US Dollar Index below a 105.0 mark.

The US Dollar Index measured against a basket of six major currencies on an average had ended up the day at 104.50. Nonetheless, complicating the rate-hike scenario further for the US Fed, Friday’s US non-farm payroll data had unveiled that US employers added 263,000 jobs last month – marginally higher than what the analysts were anticipating - however, a 0.6 per cent increase in hourly wage growth had added to headaches, as a sustenance in rise on hourly wages had comfortably contributed to an inflation-surge throughout the year.

Amid such conflicting narratives, it remains to be seen whether the US Fed could pause its dubitable rate-hike cycles aimed more at promoting Dollarization in expense of common Americans, as a number of heavyweight US lenders like of Goldman Sachs had forecasted a recession in the US as early as by early-2023, mostly catalysed by the US Fed’s rate-hike cycle.

US Dollar gives back gains as pervasive wage growth glooms inflation scenario

Citing statistics, in the day’s FX market wind-down, the US Dollar Index measured against a basket of six major currencies fell 0.13 per cent to 104.50, while the bloc’s common currency Euro added 0.10 per cent to $1.0537, hitting the highest level since late-June.

Japanese Yen gained 0.71 per cent against its American counterpart to 134.38 yen per Dollar, while Swiss Franc fell 0.04 per cent to $0.9374. On top of that, Sterling gained 0.27 per cent to $1.2295 against the greenback, while risk-sensitive loonies like of Aussies remained unchanged at $0.6811.

Canadian Dollar fell 0.18 per cent to $1.3458 against the US Dollar as crude oil prices fall marginally ahead of OPEC+ meet.