The US dollar rallied against a basket of major currencies today as positive economic data released in the United States over the trading session reinforced the case for an interest rate hike from the Federal Reserve.
Basically all US economic reports released on Thursday were good, meeting or exceeding expectations. The data showed that the US economy was robust, and that was especially notable after the damage done by the Hurricanes Harvey and Irma. It made investors optimistic ahead of Friday’s nonfarm payrolls.
Today’s news bolstered the already strong outlook for monetary tightening from the Fed. While chances for an interest rate hike on the next meeting in November is basically non-existent, chances for a December hike are at 88% according to CME FedWatch.
EUR/USD dropped from 1.1759 to 1.1710 as of 21:12 GMT today. GBP/USD slumped from 1.3246 to 1.3118. USD/JPY opened at 112.74 to the daily low of 112.40, but bounced to 112.81 later.
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