Market Analysis

The dollar is gaining ground ahead of the NFP report


The US dollar is gaining ground on other major currencies during early Friday trading. The greenback is in demand after employment data published on Thursday showed that unemployment claims remain low, with expectations for today’s non-farm payrolls also looking positive. Against the background of a healthy labour market and lingering inflation, the case for an increasingly hawkish Fed builds up, with several more interest rate hikes expected in the run-up to the end of the year, with the next one likely to be of 50 basis points. In such a scenario, there is scope for further dollar gains, especially versus the Japanese yen, as the bank of Japan shows no interest in shifting its dovish stance, and versus the euro, as the European Union’s energy crisis and dependency on Russian supplies remains a cause for concern.

Source: ActivTrader


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