US Dollar weakens as risk-appetites spur up after consumer spending data

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US Dollar weakens as risk-appetites spur up after consumer spending data
US Dollar weakens as risk-appetites spur up after consumer spending data

On Friday, ahead of a long holiday, the US Dollar Index (DXY) measured against a bucket of six major currencies on an average fell 0.15 per cent to 103.95, as money markets across the US remained choppy following release of a dismal consumer spending data.

In the matter of the fact, earlier in the day, the US Commerce Department had unveiled that US consumer spending, the cornerstone of US economy accountable for roughly a 66 per cent entire US economic activity, rose barely last month, however, other economic data had illustrated that the US Fed would unlikely to bring a pause at its aggressive rate-hike cycle.

Breaking off US Consumer spending Index, spending on durable and costly items dropped by 2.3 per cent last month, while spending on services such as utility bills rose by 0.7 per cent, pointing towards an economy which is close to losing its fuel to battle against a bruising inflation-surge which eventually had taken a greater toll on investors’ morale.

Heavy-weight US lenders like of Goldman Sachs alongside JP Morgan had forecasted a recession in the US as early as by early-2023. If truth is to be spoken, Friday’s downward spiral in US Dollar was almost entirely galvanized by worries over further rate-hikes from the US Fed amid what would more likely to be a recessed economy by March next year.

Dollar falls after Consumer spending data

Citing statistics, in the day’s FX market wind-down, euro gained 0.2 per cent against its American counterpart to $1.0619, while the single European currency has wrapped up the week about 0.4 per cent higher against US Dollar, marking off its second straight week of gain.

Apart from that, Euro net longs jumped to 142,272 contracts, the highest since January 2021. Besides, the risk-sensitive Aussies advanced 0.4 per cent to $0.6710, while the Kiwis added 0.7 per cent to $0.6288 against the greenback.

As crude oil prices jumped over 3 per cent on Friday, commodity-linked Canadian Dollar added 0.4 per cent to C$1.3590. Against the Japanese yen, the US Dollar rose by 0.4 per cent to 132.82 yen per dollar, while sterling added 0.12 per cent to $1.2051 against its American peer.

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