Dol­lar drops as weak data sinks US rate hopes

The Myanmar Times - - International Business -

THE dol­lar slumped in Asia yes­ter­day as an­other weak batch of US data all but ham­mered any chance of the Fed­eral Re­serve hik­ing in­ter­est rates this month.

The In­sti­tute for Sup­ply Man­age­ment said its US non-man­u­fac­tur­ing pur­chas­ing man­agers’ in­dex (PMI) – a key read­ing of the all-im­por­tant US ser­vice sec­tor – had dived to its low­est level in more than six years.

The data fol­lows fig­ures show­ing a slow­down in jobs cre­ation and fac­tory ac­tiv­ity, hit­ting hopes that the world’s top econ­omy was strong enough to with­stand higher bor­row­ing costs.

“The tri­fecta of ter­ri­ble ISM man­u­fac­tur­ing and non-man­u­fac­tur­ing PMIs and weaker-than-ex­pected non-farm pay­rolls have left the quixotic calls for a Septem­ber rate hike dead in the wa­ter,” An­gus Ni­chol­son, a mar­ket an­a­lyst in Mel­bourne at IG Ltd, said.

“This is no longer a Septem­ber story – for even a De­cem­ber rate hike to oc­cur both ... PMIs are go­ing to have to stage quite a rapid re­cov­ery in the next month or so.”

In Tokyo, the dol­lar dropped to 101.39 yen from 101.99 yen in New York and well off the 103.60 yen on Septem­ber 6.

The green­back also slumped more than 1 per­cent to a near oneyear low against the South Korean won, while it was also sharply down against the Aus­tralian and Sin­ga­pore dol­lars, the In­done­sian ru­piah and the Turk­ish lira. –

Photo: AFP

Tourists walk along the seafront near the Syd­ney Opera House. Aus­tralia’s econ­omy grew by 0.5 per­cent in the June quar­ter with an up­swing in gov­ern­ment spend­ing off­set­ting a fall in net ex­ports as the na­tion marked 25 years of un­bro­ken eco­nomic ex­pan­sion.

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