USD saw volatile trading last week. U.S. Tax bill and series of economic data were in focus last week. USD ended the week lower after gaining early in the week on the back of incoming economic data. On Friday USD went sharply down on reports that US former national security adviser, Michael Flynn, pleaded guilty, indirectly increasing investigation clouds around Trump. The string of positive U.S. economic data released last week boosted the sentiment for the U.S. economy and increased the likelihood of a rate hike by the Fed in its December monetary policy review.
USD Index (DXY), which tracks the movement of the USD against six major currencies, rose 0.11% on a week on week basis and is at a level of 92.88, during the weak DXY rose up to 93.27.
GDP data showed that the in the July-September period, U.S. economy expanded by 3.3%, beating expectations of 3.2% growth. The quarterly growth was the first time since 2014 that the U.S. economy has experienced growth of 3% or more for two quarters in a row.
U.S. Commerce Department reported that personal spending rose 0.3% in October against previous month and in line with market expectations.
The personal consumption expenditures (PCE) price index excluding food and energy, rose 1.4% in the 12 months through October. That was largely in-line with the expectations but well below the Fed’s 2% target, fuelling expectations that the trend of subdued inflation will keep interest rates lower for longer.
The Commerce department reported that U.S. inflation adjusted consumer spending, which accounts for more than two-thirds of U.S. economic activity, rose 0.1% last month.
U.S. economy remained bullish as consumer confidence index rose to its highest level since 2000.Data released showed that the consumer index rose to 129.5 in the month of October from 125.9 in October against the expectation for a reading of 124.
The Chicago Purchasing Managers’ Index (PMI) declined to 63.9 in November from October reading of 66.2 against the expectation for a reading of 63.
Institute of Supply Management reported that the U.S. manufacturing sector growth slowed last month. Data showed that the Institute for Supply Management’s index posted a reading of 58.2 in November against the expectations for a reading of 58.4.
Euro depreciated by 0.53% against the USD last week, as in Germany, Chancellor Angela Merkel was still struggling to form a government. British Pound appreciated by 1.06% against the USD on market reports of European union and UK being close to seal a Brexit deal but nothing has been confirmed by authorities. Investors remain optimistic about deal.
Asian currencies were mixed last week against the USD. Australian Dollar depreciated by 0.24%, New Zealand Dollar depreciated by 0.13%, Japanese Yen depreciated by 0.16% against the USD and depreciated by 0.58% against the Euro. South Korean Won depreciated by 0.11%, Philippines Peso appreciated by 0.79%, Indonesian Rupiah depreciated by 0.14%, Indian Rupee appreciated by 0.37% against the USD and appreciated by 0.57% against the Euro, Chinese Yuan depreciated by 0.22%, Malaysian Ringgit appreciated by 0.62% and Thai Baht appreciated by 0.14%.