Weekly Roundup: US dollar plummets on easing Fed rate hike bets
Amy Richards November 28th 2022 - < 1 minute read
The US dollar initially ticked higher last week as a cautious market mood saw investors favour the safe-haven currency.
However, the ‘greenback’s strength proved short-lived as a downturn in US Treasury yields began to take its toll on the currency.
A USD selling bias was then firmly in place through the middle of the week, with the US dollar propelled to new multi-month lows.
A much steeper-than-expected drop in the latest US PMI releases initially triggered the decline, before the selloff accelerated after the minutes from the Federal Reserve’s November policy meeting revealed a ‘substantial majority’ of policymakers wish to slow the bank’s current tightening cycle.
While the US dollar was able to claw back some of these gains later in the week as market sentiment soured again, thin trading conditions limited the currency’s upside potential.
Turning to this week, the highlight for USD investors will be the publication of the latest US payroll figures. Could a larger-than-expected fall in the number of jobs added by the US economy last month further undermine Fed rate hike expectations and drag the US dollar lower?