Now Reading: Dollar falls as US retail sales drop, September rate hike bets cool
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Dollar falls as US retail sales drop, September rate hike bets cool
Dollar falls as US retail sales drop, September rate hike bets cool
The dollar fell on Friday after U.S. retail sales unexpectedly dropped 0.6% in July, against economists' forecast of a 0.1% gain. Traders now price in just a 31% chance of a September…
The Story in Brief
The dollar fell on Friday after U.S. retail sales unexpectedly dropped 0.6% in July, against economists' forecast of a 0.1% gain. Traders now price in just a 31% chance of a September rate hike, down from 35% after Thursday's flat producer price index data. The euro rose to $1.1585, its highest since June 17, and sterling reached $1.3561, its best since May 12.
The Japanese yen strengthened 0.08% to 159.37 per dollar after recent U.S.-Japan intervention effects faded. Reuters reports the Bank of Japan is set to raise rates as soon as September, with more aggressive hikes under consideration. Oil prices climbed on renewed attacks on tankers and U.S.-Iran tensions. Friday's retail sales data follows July's surprise job losses and soft consumer price inflation, confirming an economic slowdown in the United States, according to Monex USA's Juan Perez.
The Indian Opinion
Markets are betting the Fed will hold rates, but the narrative of a cooling U.S. economy ignores sticky inflation above 2% and climbing oil prices from Iran tensions. Both the PPI and retail sales numbers are one month of data. The real test is personal consumption expenditures due later this month. If that number stays high, will traders still call for no hike?
Sources (2): livemint.com, livemint.com (2)
This story was synthesised by AI from the 2 sources linked above.
Updated: this story now draws on 2 sources.
