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Fresh attacks and partisan row are ahead for U. S. economy as Republicans lawmakers and strategists are capitalizing on news that the economy expanded at a weak pace in Q3 to criticize Biden and Democrats, accusing them of unskilled recovery tactics from the pandemic recession.
The U. S. Dollar Index rallied 0.86% during the New York session, is at 94.10, short of the 94.30 fresh weekly high.
U. S. T-bond yields fell, with the 10-year benchmark note down two basis points, at 1.545% as the market sentiment was mixed, depicted by European stock indices, splitting between gainers and losers.
The overall scene was positive, Friday, for U. S. shares although U.S. futures pointed lower, Thursday, headed by the Nasdaq Composite and the S&P 500, which were falling sharply due to missed earnings by Apple and Amazon.
But on Friday, the indices rise between 0.05% and 0.19%, ultimately boosting the U. S. dollar prospects. Friday’s price action printed a huge candlestick that completely covered Thursday’s one, forming a bullish engulfing candle with a solid upward conviction of USD bulls.
Economic Data
U.S. energy firms added oil and natural gas rigs for a 15 successive months in October as oil prices soared to fresh highs, prompting some drillers to return to the drilling sites.
U.S. oil rigs rose one to 444 this week, while gas rigs also gained one to 100, their highest since mid-September.
Consumer confidence in the US weakened modestly in October with the University of Michigan’s Consumer Sentiment Index declining to 71.7 in October’s final reading from 72.8 in September. This print came in slightly better than the flash estimate and the market expectation of 71.4.
Other details have indicated that the Current Conditions Index edged lower to 77.7 from 80.1 and the Consumer Expectations Index fell to 67.9 from 68.1.
The positive impact of higher income expectations and the receding coronavirus has been offset by higher rates of inflation and falling confidence in government economic policies.
Other Developments
French president Emmanuel Macron has warned that an energy crisis threatens the world’s post-pandemic economic recovery. Macron also called for leaders at a G20 summit in Rome this weekend to work together to stabilize supplies.
In an interview, the French president also urged bigger financial commitments towards the fight against global warming on the eve of the COP26 climate summit in Scotland, and for particular attention to be paid to a deal to phase out coal power.
Economic recovery in the Eurozone has stepped up according to new GDP data published today, with the bloc outshining the U. S. and China for the second successive quarter.
Growth rose faster than expected to 2.2 per cent in the three months to September, following a rise of 2.1 per cent in the previous quarter, meaning the euro area is now just 0.5 per cent smaller than in the final quarter of 2019 before the pandemic hit.
The bloc’s progress could be derailed in the final three months of the year by surging inflation, which — according to preliminary data also published this morning — hit a 13-year high of 4.1 per cent in October, driven by supply chain problems and soaring energy prices.
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