{"id":109964,"date":"2024-12-30T15:56:52","date_gmt":"2024-12-30T11:56:52","guid":{"rendered":"https:\/\/noortrends.ae\/en\/?p=109964"},"modified":"2024-12-30T15:56:56","modified_gmt":"2024-12-30T11:56:56","slug":"us-dollar-retreats-slightly-but-holds-near-highs-as-year-end-approaches","status":"publish","type":"post","link":"https:\/\/noortrends.ae\/en\/us-dollar-retreats-slightly-but-holds-near-highs-as-year-end-approaches\/12\/30\/market-updates\/","title":{"rendered":"US Dollar Retreats Slightly but Holds Near Highs as Year-End Approaches"},"content":{"rendered":"\n<p><\/p>\n\n\n\n<p>The US dollar edged down on Monday, with the <strong>Dollar Index<\/strong> slipping <strong>0.1% to 107.690<\/strong> as of 09:55 GMT. Despite this minor dip, the dollar remains on track for a <strong>monthly gain of over 2%<\/strong>, bringing its <strong>year-to-date rise to nearly 7%<\/strong>.<\/p>\n\n\n\n<p><strong>Key Drivers Behind the Dollar\u2019s Performance:<\/strong><\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Rising Treasury Yields<\/strong>: The dollar has benefited from surging US Treasury yields, with the <strong>10-year yield<\/strong> hitting a seven-month high last week. However, yields eased slightly to <strong>4.599%<\/strong> on Monday, contributing to the dollar&#8217;s retreat.<\/li>\n\n\n\n<li><strong>Policy Impact of Donald Trump&#8217;s Election<\/strong>: The greenback has gained from expectations of growth-oriented policies, including tax cuts and tariff hikes, which could sustain inflation and limit the Federal Reserve&#8217;s pace of rate cuts.<\/li>\n\n\n\n<li><strong>Federal Reserve Outlook<\/strong>: Markets currently anticipate just <strong>35 basis points<\/strong> of rate cuts in 2025, following the central bank&#8217;s projection of two 25 bps cuts earlier this month.<\/li>\n<\/ol>\n\n\n\n<p><strong>Key Events Ahead:<\/strong><br>Traders are closely watching weekly <strong>jobless claims<\/strong> on Thursday and the <strong>ISM Manufacturing PMI<\/strong> on Friday, alongside remarks from <strong>FOMC member Thomas Barkin<\/strong>.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>EUR\/USD Gains Slightly Amid Spanish Inflation Data<\/strong><\/h3>\n\n\n\n<p>The <strong>EUR\/USD<\/strong> pair rose <strong>0.1% to 1.0439<\/strong>, bolstered by Spain\u2019s annual EU-harmonized inflation rate increasing to <strong>2.8%<\/strong> in December from <strong>2.4%<\/strong> in November.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The <strong>European Central Bank (ECB)<\/strong> recently cut interest rates and hinted at further easing. However, rising inflation in parts of the Eurozone, including Spain, could delay additional cuts.<\/li>\n\n\n\n<li>Eurozone annual inflation for November accelerated to <strong>2.2%<\/strong>, exceeding the ECB\u2019s <strong>2% target rate<\/strong>, as noted by ECB Governing Council member <strong>Robert Holzmann<\/strong>.<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>GBP\/USD Inches Higher Despite Weak Economic Outlook<\/strong><\/h3>\n\n\n\n<p>The <strong>GBP\/USD<\/strong> pair climbed <strong>0.1% to 1.2595<\/strong> in quiet trading ahead of Thursday\u2019s manufacturing PMI data.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The UK\u2019s manufacturing sector is expected to remain in contraction, reflecting the broader economic stagnation after flat GDP growth in Q3.<\/li>\n\n\n\n<li>The <strong>Bank of England<\/strong> showed a dovish stance with a 6-3 vote to hold interest rates, signaling further rate cuts in 2025.<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>USD\/JPY Remains Elevated, Intervention Risks Loom<\/strong><\/h3>\n\n\n\n<p>The <strong>USD\/JPY<\/strong> pair traded flat at <strong>157.76<\/strong>, near five-month highs, as the yen remains weak. Intervention by Japanese authorities remains a risk, preventing the pair from testing the <strong>160 level<\/strong>.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The <strong>Bank of Japan (BOJ)<\/strong> recently held its policy rate steady at <strong>0.25%<\/strong>, emphasizing a cautious approach to further rate hikes.<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Chinese Yuan Weakens Further Amid Policy Concerns<\/strong><\/h3>\n\n\n\n<p>The <strong>USD\/CNY<\/strong> rose <strong>0.2% to 7.3136<\/strong>, hovering near a one-year high as China\u2019s fiscal expansion plans and looser monetary policy weigh on the yuan.<\/p>\n\n\n\n<p>Investors will closely monitor upcoming <strong>US jobless data<\/strong> and <strong>PMI surveys<\/strong> to gauge further movements in the dollar and global currencies.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The US dollar edged down on Monday, with the Dollar Index slipping 0.1% to 107.690 as of 09:55 GMT. Despite this minor dip, the dollar remains on track for a monthly gain of over 2%, bringing its year-to-date rise to nearly 7%. Key Drivers Behind the Dollar\u2019s Performance: Rising Treasury Yields: The dollar has benefited &hellip;<\/p>\n","protected":false},"author":9,"featured_media":94903,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[37,36],"tags":[6943,7987,6987],"class_list":["post-109964","post","type-post","status-publish","format-standard","has-post-thumbnail","","category-forex-markets","category-market-updates","tag-bostic","tag-cpi-data","tag-inflation"],"_links":{"self":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/109964","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/users\/9"}],"replies":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/comments?post=109964"}],"version-history":[{"count":2,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/109964\/revisions"}],"predecessor-version":[{"id":109966,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/109964\/revisions\/109966"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/media\/94903"}],"wp:attachment":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/media?parent=109964"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/categories?post=109964"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/tags?post=109964"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}