4 Sept 2022

USD rises after strong data

USD exhibited broad strength last week, gaining against all the major world currencies after the release of strong US economic data. INR after touching record low levels on Monday, recovered in the later part of the week.

author dp
Team INRBonds
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  • USD exhibited broad strength last week, gaining against all the major world currencies after the release of strong economic data last week.
  • US jobless claims unexpectedly fell to 232,000, down from a downwardly revised 238,000 and well below the 248,000 expectation. This was the third straight week of declines.
  • US ISM manufacturing data was also stronger than expected, climbing to 52.8% in August, unchanged from July and defying expectations of a slowdown.
  • US non-farm payroll data showed that 315,000 jobs were added in August, slightly above the 300,000 forecasts. Meanwhile, the unemployment rate rose to 3.7%, up from 3.5%.
  • Average wage growth held steady at 5.2%, when expectations had been for a tick higher to 5.3%.
  • INR after touching record low levels on Monday, recovered in the later part of the week.
  • Indian trade deficit narrows slightly to USD 28.7 billion from the record USD 30 billion which was recorded in July
  • The RBI reiterated on Friday that inflation had peaked and could ease back to around 5% in the June quarter. The RBI added that inflation was high owing to supply-side issues rather than demand.

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