Dol­lar hit by dis­ap­point­ing new data

The Myanmar Times - - Business -

THE dol­lar sank yes­ter­day in Asia as dis­ap­point­ing US data poured cold water on the chances of a US in­ter­est rate hike this year.

The green­back lost ground against its ma­jor peers and emerg­ing cur­ren­cies, as in­vestors re­acted to news that US sec­ond-quar­ter pro­duc­tiv­ity had fallen 0.5 per­cent.

The re­sult marks a de­cline for the third con­sec­u­tive quar­ter. The US unit had risen at the start of the week af­ter fig­ures on Au­gust 5 showed the world’s top econ­omy added more jobs than ex­pected last month.

“Higher-yield­ing cur­ren­cies are lead­ing the charge, stoked by boom­ing risk ap­petite,” Stephen Innes, se­nior trader at OANDA Asia Pa­cific, said in a com­men­tary.

“The mar­ket is buy­ing into the un­der­ly­ing premise that the US econ­omy is ro­bust, but not churn­ing at suf­fi­cient lev­els to war­rant any im­me­di­ate pol­icy re­sponse,” Mr Innes said.

In yes­ter­day’s trad­ing, the dol­lar changed hands at 101.23 yen, down from 101.88 yen in New York and 102.44 yen in Tokyo.

The euro rose to US$1.1154 from $1.1115 in US trade, while fall­ing to 112.90 yen from 113.25 yen.

On Au­gust 5, the La­bor De­part­ment said the US econ­omy added 255,000 jobs in July, beat­ing an­a­lyst fore­casts for an in­crease of 185,000 pay­rolls, while also up­grad­ing em­ploy­ment es­ti­mates for the prior two months. The fig­ures had boosted ex­pec­ta­tions that the Federal Re­serve would lift bor­row­ing costs this year.

Against the dol­lar, the South Korean won soared 0.7pc, and the Tai­wan dol­lar and Malaysian ring­git both tacked on 0.5pc, while the Thai baht, Sin­ga­pore dol­lar, Philip­pine peso and In­done­sia’s ru­piah also booked healthy gains.

The pound rose to $1.3085 from $1.3000 in US trade. –

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