It's Tom Westbrook
SINGAPORE (Reuters) – The dollar looked to extend its longest weekly winning streak in a year on Friday, supported by rising bond yields and expectations of another strong set of U.S. jobs numbers.
The dollar gained 0.5% against the yen this week to trade at 158.03 yen and added more than 1% to the ailing British pound, which was hit at a 14-month low with a selloff in gilts and concerns about currencies. British.
The dollar was set for a steady week against the euro, which traded at $1.0926 and saw little gain against the Australian and New Zealand dollars. (AUD/)
It is set for a sixth consecutive weekly gain, the longest streak since 11 weeks in 2023 as the US economy continues to look strong against weakness elsewhere.
The index was stable in Asia on Friday morning at 0.25% weekly increase at 109.18.
“We doubt the dollar should recapture much of its recent gains,” said Chris Turner, head of global markets at ING, noting the move to higher positions and upside risks to the dollar from US jobs data due later. day.
“Despite the risk of profit taking, (the dollar index) found good support under 108 at the beginning of the week.”
Sterling was a fraction weaker at $1.2295, after touching a 14-month low of $1.2239 earlier in the week. The Australian and New Zealand dollars rallied near multi-year lows, with the latter at $0.6190 – coming within a whisker of breaking the 2022 low of $0.6170.
The New Zealand dollar reassessed the 2022 low of $0.5512 and was last at $0.5594.
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US non-farm payrolls data is expected to show 150,000 jobs were added in December, with unemployment holding at 4.2%.
A hint of anything stronger could add to the case for a few Federal Reserve rate cuts and could start another round of selling in jittery bond markets.
Overnight Philadelphia Fed President Patrick Harker said he expected the US central bank to cut interest rates, but added that further cuts were unlikely.
Markets have already lowered expectations for about a 40 basis point US rate cut by 2025, while concerns about President-elect Donald Trump's inflationary agenda have helped lift long-term yields.
The ten-year Treasury yield rose nearly 9 basis points this week to 4.68% and is up 96 bps since mid-September. (US/)
The ten-year gilt yield rose 22 bps this week to 4.805%. (GB/)
Unusually, the ructions in the bond market seem to have been felt by cryptocurrencies, with bitcoin down 5.7% on the dollar in the week to 92,600 dollars.
“I'm not sure how many in the crypto space would know … the dynamics that are forming in US / Treasuries rates, and many will question the factors behind the movement of crypto,” said Pepperstone's head of research. Chris Weston.