US dollar edges up on positioning moves, but outlook stays negative
The U.S. dollar drifted higher on Friday, a day after falling on a surge in U.S. jobless claims and a modest inflation uptick, ahead of a Federal Reserve meeting next week that is likely to cut interest rates after a roughly nine-month hiatus.
The greenback rose 0.2% to 147.53 yen , rising for three straight weeks. The dollar firmed earlier on Friday after a U.S.-Japanese joint statement affirmed exchange rates should be "market determined" and that excess volatility and disorderly moves in exchange rates were undesirable.
The dollar index was little changed at 97.59, but stayed on track to post a weekly fall of 0.1% for its second consecutive weekly decline.
John Velis, Americas macro strategist at BNY in New York, said Friday's gains were more about position-squaring ahead of the weekend.
"The broader picture is still quite negative for the dollar on a variety of measures," Velis said. "One, of course, is the Fed now beginning to cut rates. The other is, we still see hedging behavior taking place, so foreign investors buying U.S. assets and selling the dollar to hedge it, which is going to keep pressure on the dollar."
Data showing U.S. consumer sentiment falling for a second straight month in September weighed slightly on the greenback.
The euro was flat versus the dollar at $1.1736, a day after rising, as traders curbed their bets on another European Central Bank rate cut this cycle to bet on another move at less than 50%.
Among other currencies, sterling was little changed at $1.3564 , after data showed the British economy stagnated in July, while the Australian dollar was a touch softer at US$0.6651 , not far from a 10-month high.
Source: Reuters
