© Reuters. FILE PHOTO: A clerk counts US dollar bills at a currency exchange office in downtown Cairo.
By Tom Westbrook SINGAPORE (Reuters) – The dollar advanced slightly on Friday, but was heading for its softest week of the year as strong data in Europe, surprisingly weak employment figures in the United States and a decidedly accommodative Federal Reserve have led to investors cut their bets on the dollar. . The euro and yen are also poised for their biggest weekly percentage gains in four and five months, respectively, while, which has fallen 0.9% this week, remains near a two-week low at 92.171. “In summary, energy has come out of the dollar rebound in the first quarter, just as it has come out of the bond sell-off,” said Kit Juckes, head of foreign exchange strategy at Societe Generale (OTC :). In the Asian session, the euro lost 0.1% but remained above its 200-day moving average at $ 1.1900, while the yen surpassed its 20-day moving average to remain at 109.32 per dollar. Both currencies have gained 1.3% against the dollar so far this week. The euro is also up more than 2% against the pound this week, bouncing from a year-long low of 84.70 pence on Monday to hit 86.81 pence, its highest since February, amid mounting concerns about Britain’s dependence on AstraZeneca (NASDAQ 🙂 ‘s vaccine. The British pound was an outlier against the dollar this week and has so far fallen 0.7% to settle at $ 1.3723. The vaccine, developed with the University of Oxford and considered a pioneer in the global inoculation race, has been plagued with safety concerns and supply problems. Australia and the Philippines have limited use of the injection, the African Union abandoned plans to buy it and Hong Kong delayed it. The Australian and New Zealand dollars were in the upper half of the ranges that have held them for about two weeks. [AUD/] A slightly cautious mood in equity markets and a warning from Australia’s central bank of excessive credit risk dampened it, which fell around 0.4% to $ 0.7623 to set it on course for a weekly gain of 0.4 %. He was down 0.3% to $ 0.7036 and is up 0.3% on the week. EBBS IN DOLLARS The pause in the dollar’s rally follows a solid rebound from what had been the dollar’s softest year since 2017. Rising Treasury yields and the growing consensus that the US economy is now in the dark. The US can lift the world out of the pandemic raised the dollar index 3.6% last quarter, its best quarter in nearly three years. However, after a series of strong data, Thursday’s figures showed that US jobless claims rose unexpectedly. Speakers from the Fed also promised again to keep monetary policy super easy. Chairman Jerome Powell said policy would not change until there was at least a series of good data for a month, while board member James Bullard said the Fed shouldn’t even discuss the changes until it is clear that the pandemic is over. A crucial test looms in the coming weeks and months, according to Indosuez Asia capital markets chief Davis Hall, as markets and the Fed face higher inflation results and possibly a European recovery gathering steam. Meanwhile, the starting price of European factories accelerated after surprisingly strong growth in business activity. “We are very skeptical that this will continue to be a sustainable rally in the dollar,” Hall said by phone from Hong Kong. “The dollar / yen may rise and the dollar / Swiss may rise, due to interest rate differentials, but if US growth is strong, it is not certain that it will benefit the dollar as long as Europe can start. your own vaccination success and drive. “That’s the key. We are allowing the dollar to rally, but we are going to use the strength of the dollar rally to diversify away from exposure to the dollar, and we like Asian currencies. ”