Sun, Nov 05, 2017 - Page 14 News List

Greenback rises after strong US economic data

Reuters, NEW YORK

The US dollar rose broadly on Friday after the release of US factory orders and services sector data that beat estimates, reversing an earlier slide after an underwhelming jobs report for last month.

The euro turned negative against the US dollar, falling to its lowest level since Monday after the US factory orders and the Institute for Supply Management’s non-manufacturing purchasing managers’ index (PMI), while the US dollar turned positive against the Japanese yen, erasing earlier losses and nearing its highest since mid-July.

The Japanese yen climbed less than 0.05 percent to ¥114.07.

The non-manufacturing PMI rose to its highest level since 2005.

New orders for US-made goods rose for the second straight month in September and orders for core capital goods surpassed expectations.

The US dollar index, which measures the greenback against six rival currencies, rose to its highest since Oct. 27, closing in on a nearly four-month peak.

The strong data backed a slate of releases on US growth and inflation from earlier in the week that pointed to a strong economy and further interest rate increases from the US Federal Reserve.

“When we look at the big picture, we’re looking at a Fed that’s likely to hike in December and could very well have three hikes up its sleeve for 2018 and that is certainly a more hawkish outlook than we’re expecting from most other major central banks,” said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange Inc in Washington.

The US dollar had earlier fallen to its lows of the day after the release of last month’s US non-farm payrolls, which came in below expectations.

The jobs report showed its largest gain since July last year, but missed economists’ expectations for an increase of 310,000 jobs, following a particularly weak reading in September.

The US dollar index posted its third straight weekly increase to 94.94, following its largest weekly percentage gain of the year last week, when it ended the week at 94.92.

Last month was the US dollar’s best monthly performance since February.

In Taipei, the New Taiwan dollar rose against the US dollar, gaining NT$0.014 to close at NT$30.172, up 0.3 percent from last week’s NT$30.277.

Digital currency bitcoin took another leap higher, rocketing above US$7,000 for the first time after a more than 10-fold increase in value over the past year.

It hit as high as US$7,500 on the Luxembourg-based Bitstamp exchange on Friday.

“People should not be surprised by this move. They should try to understand it before dismissing it,” said Rahul Sood, chief executive officer of Unikrn, a US sports betting digital platform. “The fact is there is a finite amount of Bitcoin in the world ... it’s just a much better trading commodity than paper gold — and more convenient than fiat currency.”

Additional reporting by CNA

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