Comments
The dollar stood tall in Asian trading on Friday, on track for a weekly gain against a basket of currencies, as the euro wallowed close to four-month lows after the European Central Bank quashed any speculation of tapering its stimulus.
The dollar index, which gauges the greenback against six major rivals, was up 0.1 per cent at 98.369, up 0.4 per cent for the week and not far from its overnight high of 98.404, its loftiest peak since March 10.
The euro was slightly lower at $1.0925, poised to shed 0.4 per cent for the week after plumbing $1.0914 on Thursday, its lowest since June 24.
ECB policy stance
ECB President Mario Draghi left the door open to a wide range of policy options and emphasised that a long-awaited rise in inflation is predicated on “very substantial” monetary accommodation - giving markets no reason to believe the central bank was ready to talk about tapering its €1.7 trillion ($1.86 trillion) asset-buying programme.
“We expect further discussion of these issues at the December meeting, where a fuller set of forecasts will be produced. For now, markets have been sent a dovish signal relative to earlier speculation,” strategists at Rabobank said.
US home resales
US data on Thursday, by contrast, showed that US home resales surged in September after two straight months of declines, which gave investors more reason to bet that the US Federal Reserve would hike interest rates as early as its December 13-14 meeting.
Separate data showed that first-time filings for unemployment benefits rose more than expected to 260,000 last week, but the trend suggests the labour market remains strong.
The dollar added 0.2 per cent to 104.13 yen, but was still down 0.1 per cent for the week.
Recently battered sterling was steady at $1.2252, on track to gain 0.5 per cent for the week.
Brexit
European Council chief Donald Tusk said EU leaders would not engage in negotiations on Britain’s exit from the bloc at Prime Minister Theresa May’s first summit in Brussels, ruling out any Brexit negotiations until May formally launches the exit process.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.