US dollar to mark first annual fall in years after falling to the lowest levels since July
ALBAWABA – The US Dollar extended its dip over the weekend, having fallen to the lowest since July on Friday, as inflation data fuelled expectations that the United States (US) Federal Reserve (Fed) will be cutting interest rates soon in 2024.
So far, Bloomberg reported the US dollar is set to mark its first annual decline in three years, as inflation data feed the rate cut frenzy.
The US dollar stood at EUR0.9079, GBP0.7872, CYN7.1315, as of Sunday 1611 Amman Time, and was up 0.0421 percent at JPY142.4100, according to Reuters.
Core personal consumption expenditures price index, which strips out volatile food and energy components, increased 0.1 percent in November from a month earlier.
Notably, the CPC was revised to a 0.1 gain in October, according to a report from the Bureau of Economic Analysis, as reported by Bloomberg.
Earlier last week, official US data showed the consumer prices index also falling, while jobs were strong, pointing a soft landing for the US economy, which has driven record rallies on Wall Street.
Meanwhile, Bloomberg Dollar Spot Index fell as much as 0.3 percent on Friday to the lowest since July, weakening against nearly all of its major peers in the developed world.
US dollar down as inflation data feeds rate cut frenzy - Shutterstock
The Swiss franc rose to the strongest level against the US currency since 2015, while the euro and Norwegian krone rose to their highest levels since August.
The US dollar rose against a basket of currencies on Wednesday, Reuters reported, as a late-session selloff on Wall Street boosted the currency's safe-haven appeal.
Data on sharply falling inflation in the United Kingdom (UK) prompted a steep drop in the British pound, further bolstering the US dollar.
The dollar was last up 0.28 percent on Thursday, at 102.42, on pace to break a two-day losing streak, as reported by Reuters, with the dollar index down about 1.5 percent for the week ending Tuesday.
But the US dollar quickly slipped as investors took to Wall Street again, ahead of the holidays in the US.
Prospects of the Fed cutting rates in 2024 make for a weaker US dollar, which prompted holders to sell while interest rates are high.
