te Dollar holds steady, yuan rises on better-than-expected China data | Zee Business

Dollar holds steady, yuan rises on better-than-expected China data

US dollar rate index news: The dollar was on the front foot in Asia on Friday, retaining overnight gains against peers after strong U.S. economic data and an ECB rate hike, with traders' attention warily turning to a data deluge from China. U.S. retail sales received a boost from higher gasoline prices.

Dollar holds steady, yuan rises on better-than-expected China data
US dollar rate index news: The dollar was on the front foot in Asia on Friday. Image: Reuters

US dollar rate index news: The dollar was on the front foot in Asia on Friday, retaining overnight gains against peers after strong U.S. economic data and an ECB rate hike, with traders' attention warily turning to a data deluge from China. U.S. retail sales received a boost from higher gasoline prices, increasing 0.6 per cent in August versus an estimated 0.2 per cent rise, while market participants reacted to the European Central Bank's 25-basis point hike.

The U.S. dollar index last stood at 105.380, near Thursday's six-month peak of 105.430. The euro remained near Thursday's multi-month low of $1.0632 against the dollar. "It appears that markets have characterized the ECB’s 25bp hike yesterday to a dovish hike...that has sent EUR and European yields tumbling," analysts at Mizuho Bank said in a note. Market focus now turns to a dump of economic data out from China in the Asian morning, including retail sales and investment growth, keeping traders on edge for further signs of slowing in the world's second largest economy.

"The data today will be super important," said Rodrigo Catril, senior FX strategist at the National Bank of Australia. The offshore yuan inched further down against the dollar to 7.2918 ahead of the data. The yuan weakened on Thursday after the People's Bank of China's (PBOC) announced that it would make a 25-basis point cut to banks' reserve requirement ratio. Although the PBOC has provided "piecemeal" stimulus, it's still lacking support that will boost consumer confidence, said Catril. "In that sense it means that any disappointment coming out of the data today, we'll likely see the CNY under pressure," with risks to the Aussie and the Kiwi as well, he said.

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Written By: Reuters
Updated: Fri, Sep 15, 2023
09:03 am
New Delhi, Reuters
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