The greenback pared intra-day losses made in Asia and European morning and ended flat against its G5 peers on Friday. Better-than-expected U.S. consumer price index as well as short-covering ahead of weekend supported the dollar. Cable weakened to fresh 6-week lows as lastest round of Brexit talks this week ended in deadlock.
On the data front, Reuters reported the U.S. Labor Department said on Friday its consumer price index rose 0.4% last month. The CPI advanced 0.6% in June and July after declining in the prior three months as business closures to slow the spread of the coronavirus depressed demand.
In the 12 months through August, the CPI increased 1.3% after gaining 1.0% in July. Economists polled by Reuters had forecast the CPI rising 0.3% in August and climbing 1.2% year-on-year.
Versus the Japanese yen, dollar moved broadly sideways in lackluster Friday’s session as focus was on euro and sterling. Price rebounded from 106.09 at Asian open to 106.26 in European morning before retreating to 106.07 in New York afternoo due to falling U.S. Treasury yields and then moved narrowly.
The single currency rebounded at 1.1812 in Australia to 1.1841 in Asia and then rallied to session highs at 1.1874 in Europe on cross-buying in euro before retreating in tandem with cable to 1.1827 in New York afternoon, price last traded at 1.1845 at the close.
The British pound went through a volatile session. Cable found renewed buying at 1.2795 at Asian open and rose to 1.2863 in European morning before tumbling to a fresh 6-week low at 1.2763 on continued fear over no-deal Brexit. Despite briefly rising again to 1.2866, the pair later retreated to 1.2775 in New York.
Reuters reported big areas remain unresolved in Britain’s negotiations with the European Union, a senior British negotiating source said on Friday, flagging fisheries as one of the outstanding issues.
In other news, Reuters reported the European Parliament will not grant its necessary approval to any new EU-UK trade deal unless Britain fully implements its earlier divorce deal with the bloc, an official familiar with a looming statement by European lawmakers told Reuters.
Data to be released this week :
UK Rightmove house price, China house prices, Japan tertiary industry activity, industrial output, capital utilization and EU industrial production on Monday.
New Zealand GDT price index, Westpac consumer survey, Australia home price index, China industrial output, retail sales, UK claimant count, ILO unemployment rate, employment change, average weekly earnings, Swiss production price, France CPI (EU norm), CPI, Italy consumer prices, CPI (EU norm), Germany ZEW economic sentiment, ZEW current conditions, EU Labour costs, ZEW survey expectations, U.S. New York Fed manufacturing, import prices, export prices, redbook, industrial production, capacity utilization, manufacturing output and Canada manufacturing sales on Tuesday.
New Zealand current account, Japan exports, imports, trade balance, UK core CPI, CPI, RPI, core RPI, PPI input prices, PPI output prices, core PPI output, DCLG house price, U.S. MBA mortgage applications, retail sales ex-autos, retail sales, business inventories, NAHB housing index, Fed interest rate decision and Canada CPI, CPI core on Wednesday.
New Zealand GDP, Australia employment, unemployment rate, Japan Bank of Japan interest rate decision, Swiss trade balance, exports, imports, Italy trade balance, global trade balance, EU construction output, HICP, core HICP, UK BoE interest rate decision, asset purchases program, BOE QE total, BOE MPC vote hike, BOE MPC vote unchanged, BOE MPC vote cut and U.S. building permits, housing starts, initial jobless claims, continued jobless claims on Thursday.
Japan nationwide core CPI, Nationwide CPI, Germany producer price index, UK retail sales, retail sales ex-fuel, Italy industrial sales, industrial orders, EU current account, U.S. current account and Canada retail sales, retail sales ex-autos, wholesale trade on Friday.