FOREX
The US dollar is trading flat vs other major currencies this session but remains close to the six-week high touched on Monday. The greenback found renewed support after the release of Chinese industrial and retail data, which was disappointing. The struggles of the world’s second-largest economy show that, despite the positive rhetoric emanating from Beijing, the post-pandemic economic recovery has stalled, adding uncertainty to the future growth of the global economy. This scenario may lead to further gains for the safe-haven dollar, which tends to perform well when uncertainty rises. The greenback is also benefiting from the debate over whether or not the Fed will raise interest rates again in this cycle. Recent inflation data revealed the stickiness of the problem, with some observers seeing a path for one last hike, which could come in September. Against this background, a positive reading in US retail sales figures, which will be released later today, could trigger further short-term dollar strength.
Ricardo Evangelista – Senior Analyst, ActivTrades
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