Dollar rises on upbeat U.S. data

Market Review - 14/08/2022 23:44GMT  

Dollar rises on upbeat U.S. data

The greenback rose against majority of its peers on Friday as recent release of upbeat U.S. data increased speculation of optimism over the country's economy with inflation topping out.  
  
Reuters reported U.S. consumer sentiment ticked further up in August from a record low earlier this summer, and American households' near-term outlook for inflation eased again on the back of tumbling gasoline prices, a survey released on Friday showed.      
The University of Michigan's preliminary August reading on the overall index on consumer sentiment came in at 55.1, up from 51.5 in the prior month. It had hit a record low of 50 in June.     The preliminary August reading was above the median forecast of 52.5 among economists polled by Reuters.  
  
Versus the Japanese yen, dollar traded with a firm bias in Asia and rose from 132.89 to 1333.49 before ratcheting higher to session highs at 133.89 ahead of New York open. However, price later retreated to 133.42 near the close on profit-taking together with cross-buying in jpy.  
  
The single currency met renewed selling at 1.0324 ahead of European open and dropped to 1.0270 at New York open. The pair then ratcheted lower to an intra-day low at 1.0239 in New York morning on usd's broad-based rebound together with cross-selling in euro especially vs sterling before staging a bounce to 1.0266 near the close.  
  
The British pound briefly rose to session highs at 1.2216 at European open after the release of UK GDP. However, the pair then erased its gains and tumbled in tandem with euro to an intra-day low at 1.2100 in New York morning before staging a short-covering rebound to 1.2146.  
  
Reuters reported Britain's economy contracted by less than feared in June, when a an extra bank holiday for Queen Elizabeth's platinum jubilee had been expected to exert a big drag, although output for the second quarter as a whole still contracted.      
The Office for National Statistics said gross domestic product fell by 0.6% in June, the biggest contraction since January 2021 but still far less severe than the 1.3% drop predicted by the consensus of economists polled by Reuters.     The ONS said services output fell by 0.5% in June 2022, which was the main driver of the fall in GDP.      The additions of bank holidays in June subtracted two working days from the month.  

Data to be released next week: 

New Zealand NZ PSI, U.K. Rightmove house price, Japan GDP, industrial output, capacity utilization, China GDP, house prices, industrial output, retail sales, Germany wholesales price index, France market holiday, Italy market holiday, Swiss producer/import price, U.S. NY Fed