US Dollar Strengthens on Positive Manufacturing, Consumer Sentiment

The US dollar is strengthening against several major several currency rivals at the end of the trading week, buoyed by upbeat economic data. Investors took a day off from the never-ending seesaw of US-China trade relations that markets had to endure for the last several sessions.

On Friday, the IHS Markit manufacturing purchasing managers’ index (PMI) for November clocked in at 52.25. This is up from 51.3 in the previous month and beats market expectations of 51.6. It also represents the quickest rate since April. The flash services PMI for November came in at 51.6, up from 50.6 in October, which is also the fastest expansion in five months.
The University of Michigan released multiple final index readings for November. The much-watched consumer sentiment index was 96.8, up from 95.5 in October. Consumer expectations were also better than expected at 87.3, up from 84.2 in the previous month. Inflation expectations were unchanged at 2.5%, while the five-year inflation projections were also flat at 2.5%.
But the influx of data ended on a sour note as the Federal Reserve Bank of Kansas City’s manufacturing production index slumped to -5 in November. Last month, the index reported +8.
Next week will be important for the US economy as the third-quarter gross domestic product (GDP) growth rate published by the federal government. The market is penciling in a growth rate of 1.9%, which would be slightly down from the 2% expansion in the second quarter. Personal income, consumer spending, and durable goods orders will also be released on Wednesday.
The US Dollar Index is soaring 0.26% to 98.24, from an opening of 97.93. Overall, the US dollar had a good week posting a gain of 0.25% and lifting its year-to-date increase to 2.25%.
The USD/CAD currency pair rose 0.05% to 1.3294, from an opening of 1.3285, at 17:51 GMT on Friday. The EUR/USD tumbled 0.29% to 1.1026, from an opening of 1.1061.

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Original from: www.earnforex.com