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The US Dollar has weakened against its major rivals on Thursday after the US Department of Labour announced that there were 261,000 Initial Jobless Claims last week. The Dollar Index, which gauges the USD’s valuation against a basket of six major currencies, stays deep in negative territory below 103.50.
According to the latest outlook published by the Organisation for Economic Co-operation and Development (OECD), it sees the Fed funds rate peaking at 5.25%-5.5% from Q2 2023, followed by two “modest” cuts in the second half of 2024.
The US Census Bureau reported that the goods and services deficit stood at $74.6 billion in April. Exports declined $9.2 billion to $249 billion, while imports rose $4.8 billion to $323.6 billion.
The monthly data published by the Institute for Supply Management (ISM) showed, earlier this week, that the business activity in the US service sector continued to expand in May, albeit at a softer pace than it did in April.
The ISM Services PMI declined to 50.3 in May from 51.9 in April and missed the market expectation of 51.5. Further details of the ISM PMI report revealed that the Prices Paid Index edged lower to 56.2 from 59.6 and the Employment Index dropped to 49.2 from 50.8.
Earlier this week, the US Census Bureau announced that Factory Orders rose 0.4% in April following the 0.9% increase recorded in March. According to technical analysis, the US Dollar Index (DXY) technical picture points to a bearish tilt in the near term, with the Relative Strength Index (RSI) indicator on the daily chart retreating to 50. Additionally, DXY was last seen trading below the 20-day Simple Moving Average, currently located at 103.70.
