U.S. Dollar Weakness
After Wednesday turned out to be a very quiet trading day, the U.S. dollar weakened in the afternoon hours which was due to weaker-than-expected economic data and dovish signals from Federal Reserve Chair Jerome Powell in a speech at a forum. Powell downplayed recent high inflation readings and indicated that nothing has really changed for policymakers which could be a sign that the Fed is on track to cut rates as expected by 75bp in 2024.
Consequently, the weakness in the greenback led to a surge in the euro and British pound, pushing the euro back above 1.0830 and the pound above 1.26. Whether the dollar’s counterparts can hold above their current supports remains to be seen tomorrow.
The focus will now shift to Friday’s nonfarm payrolls numbers.
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