US Dollar bounces back hard against major currencies
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The US Dollar (USD) strengthened on Tuesday due to a report indicating that U.S. retail sales exceeded expectations in September. Concurrently, investors were closely monitoring a week filled with speeches from Federal Reserve officials.
In the report, it was revealed that retail sales experienced a 0.7% increase the previous month, driven by heightened consumer spending on motor vehicles and at restaurants and bars.
Marc Chandler, the chief market strategist at Bannockburn Global Forex, commented on this development, stating that there were concerns about the U.S. economy slowing down in Q4, particularly regarding a potential pullback in consumer spending. However, the consumer market concluded Q3 on a robust note.
Nevertheless, despite the robust retail sales figures, the US Dollar did not experience as substantial of an uptick as some had anticipated.
As of the latest data, the dollar index showed a 0.16% increase, reaching 106.40, but it still remained below the 107.34 level reached on October 3, which marked the highest point since November 2022.
Conversely, the euro saw a decline of 0.11%, reaching $1.0548. This was an improvement from the $1.0448 exchange rate recorded on October 3, which had been the lowest since December 2022.
Investor attention in the coming days is expected to focus on speeches by Federal Reserve officials, including Fed Chair Jerome Powell's address scheduled for Thursday, in hopes of gaining insights into future interest rate policies.
It's worth noting that these officials will enter a blackout period on October 21 in anticipation of the Federal Reserve's meeting scheduled for October 31 to November 1.
