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Dollar Down Over Persistent Global Economic Recovery Doubts

imageForex20 hours ago (Aug 14, 2020 12:28AM ET)

(C) Reuters.

By Gina Lee – The dollar was down on Friday morning, giving up some earlier gains as doubts persist over the global economic recovery from COVID-19.

Investor sentiment was dampened by disappointing Chinese data released earlier in the day that indicated continuous but slower recovery in industrial production, as well as a bigger-than-expected drop in retail sales.

The data said that July’s industrial production rose 4.8% year-on-year but missed the 5.1% increase in forecasts prepared by Meanwhile, retail sales fell 1.1% in the same month, against the forecasted 0.1%. The unemployment rate remained unchanged at 5.7%.

Investors will also be looking at the outcome of Saturday’s online meeting between U.S. and Chinese officials to discuss trade alongside other issues.

The USD/CNY pair was up 0.04% to 6.9468 by 12:15 AM ET (5:15 AM GMT), and the U.S. Dollar Index that tracks the greenback against a basket of other currencies slipped 0.08% to 93.243.

The U.S. said on Thursday that the number of unemployment claims over the past week dipped below the one million mark for the first time since the COVID-19 outbreak. But the news was overshadowed by the grim reality that more than 30 million Americans are out of work, as well as the suspension of negotiations over the latest U.S. stimulus measures as the Senate wrapped up its session on Thursday.

The USD/JPY pair was flat at 106.92. The yen recently saw its biggest losses against the dollar as higher U.S. yields attracted Japanese investors.

The AUD/USD pair inched down 0.01% to 0.7147. The NZD/USD pair was down 0.21% to 0.6531, with New Zealand Prime Minister Jacinda Ardern due to announce whether the country will extend or ease Auckland’s re-imposed lockdown measures later in the day.

“Risk sentiment is slowing down… it’s too early to say the whole (dollar) downtrend is over…but it’s got potential and at the very least it’s putting a cap on the AUD and NZD,” Westpac FX analyst Imre Speizer told Reuters.

The GBP/USD pair was down 0.03% to 1.3060.

Dollar Down Over Persistent Global Economic Recovery Doubts

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