Forex Today: Dollar runs on tightening speculation
What you need to know on Thursday, May 13:
The American currency rallied to fresh weekly highs against most major rivals, after the US reporter higher-than-expected April inflation. Stocks edged firmly lower while US Treasury yields rose to their highest in one month, as CPI figures suggest that the Fed is wrong about its view on inflation rising temporarily. Speculative interest rushed to price-in sooner than anticipated monetary policy tightening.
The EUR/USD pair fell to 1.2065, while GBP/USD was down to 1.4055, both ending the day near such lows. Market players ignored encouraging UK data, as the country reported generally better-than-anticipated figures. The Q1 Gross Domestic Product came in at -1.5%, while the March monthly GDP printed at 2.1%. In the same month, Industrial Production rose by 3.6% YoY, while Manufacturing Production was up by 4.8% YoY. The positive headlines were no surprise amid the impressive immunization campaign in the country leading to economic reopenings.
The Australian dollar was also sharply down against the greenback, while USD/CAD held within familiar levels as oil prices continued to advance. USD/JPY trades near its May high at 109.69.
Gold seesawed between gains and losses, ending the day in the red at $ 1,820 a troy ounce. Crude oil prices eased ahead of the close, although WTI settled at $ 65.80 a barrel.
The focus now shifts to US Retail Sales, to be out next Friday. Better than expected figures could give yet another boost to the greenback and put it in a bullish path.
Author
FXStreet Team
FXStreet
