US Dollar Falls Further on Friday, Extending Weekly Losses

Time Stamp: March 5, 2023 6:02 AM
Source Node: 2420703

The US dollar continued its downward spiral on Friday, extending its losses for the week. The dollar index, which measures the greenback against a basket of six major currencies, fell to a two-week low of 92.51, down 0.3 percent on the day. The index has now lost more than 1 percent this week, its biggest weekly decline since late April.

The dollar’s losses come amid a broad-based selloff in the currency markets. The euro rose to a two-week high against the dollar, while the Japanese yen and British pound also gained ground. The Australian dollar was the biggest gainer, rising to its highest level in nearly four months.

The dollar’s weakness is being driven by a combination of factors. The US Federal Reserve has signaled that it is in no rush to raise interest rates, which has weighed on the dollar. In addition, the US economy has been showing signs of slowing down, with weak economic data and a softening labor market. This has caused investors to move away from the dollar and into other currencies.

At the same time, other currencies have been gaining strength. The euro has been buoyed by a strong economic recovery in Europe, while the Japanese yen has been supported by expectations of further monetary easing from the Bank of Japan. The British pound has been boosted by increasing optimism about a Brexit deal being reached between the UK and EU.

The dollar’s losses could continue in the near-term as investors remain cautious about the US economy and the Fed’s policy outlook. However, if the US economy shows signs of improvement and the Fed signals that it is ready to raise rates, then the dollar could regain some of its lost ground.

In conclusion, the US dollar fell further on Friday, extending its weekly losses. The dollar’s weakness is being driven by a combination of factors, including expectations of further monetary easing from other central banks and weak economic data from the US. The dollar could continue to fall in the near-term, but could regain some of its lost ground if the US economy shows signs of improvement and the Fed signals that it is ready to raise rates.

Source: Plato Data Intelligence: PlatoAiStream