AIRLINK 189.36 Increased By ▲ 1.33 (0.71%)
BOP 11.10 Decreased By ▼ -0.76 (-6.41%)
CNERGY 7.28 Decreased By ▼ -0.26 (-3.45%)
FCCL 36.65 Decreased By ▼ -1.14 (-3.02%)
FFL 14.95 Decreased By ▼ -0.29 (-1.9%)
FLYNG 26.19 Increased By ▲ 0.66 (2.59%)
HUBC 130.89 Increased By ▲ 0.74 (0.57%)
HUMNL 13.47 Decreased By ▼ -0.14 (-1.03%)
KEL 4.28 Decreased By ▼ -0.07 (-1.61%)
KOSM 6.08 Decreased By ▼ -0.09 (-1.46%)
MLCF 45.94 Increased By ▲ 0.26 (0.57%)
OGDC 201.86 Decreased By ▼ -4.57 (-2.21%)
PACE 6.12 Decreased By ▼ -0.26 (-4.08%)
PAEL 38.36 Decreased By ▼ -1.95 (-4.84%)
PIAHCLA 16.73 Decreased By ▼ -0.22 (-1.3%)
PIBTL 7.94 Decreased By ▼ -0.09 (-1.12%)
POWER 9.86 Decreased By ▼ -0.17 (-1.69%)
PPL 173.46 Decreased By ▼ -5.38 (-3.01%)
PRL 34.73 Decreased By ▼ -1.63 (-4.48%)
PTC 23.95 Decreased By ▼ -0.44 (-1.8%)
SEARL 101.74 Decreased By ▼ -1.42 (-1.38%)
SILK 1.07 No Change ▼ 0.00 (0%)
SSGC 32.70 Decreased By ▼ -3.54 (-9.77%)
SYM 17.93 Decreased By ▼ -0.30 (-1.65%)
TELE 8.14 Decreased By ▼ -0.24 (-2.86%)
TPLP 12.02 Decreased By ▼ -0.14 (-1.15%)
TRG 67.40 Increased By ▲ 0.07 (0.1%)
WAVESAPP 11.80 Decreased By ▼ -0.21 (-1.75%)
WTL 1.52 Decreased By ▼ -0.05 (-3.18%)
YOUW 3.90 Increased By ▲ 0.01 (0.26%)
BR100 11,819 Decreased By -87.9 (-0.74%)
BR30 35,000 Decreased By -554.1 (-1.56%)
KSE100 112,085 Decreased By -478.8 (-0.43%)
KSE30 34,946 Decreased By -148 (-0.42%)
Markets

Dollar gains on strong manufacturing data

NEW YORK: The dollar gained against the euro and the yen on Monday after a manufacturing index rose to its highest l
Published October 2, 2017

NEW YORK: The dollar gained against the euro and the yen on Monday after a manufacturing index rose to its highest level since 2004, boosting hawkish bets on the US economy.

The ISM US manufacturing activity index rose to 60.8 in September, above economists' expectations of 58, while the prices paid index was also the highest since May 2011.

"The activity side of the manufacturing ISM is encouraging. It's in line with firm (manufacturing reports) around the world, which I think suggests the global manufacturing momentum is quite positive," said Vassili Serebriakov, currency strategist at Credit Agricole in New York.

"I think the markets pushed the dollar higher because the prices paid index jumped," Serebriakov said, adding: "I think we need to be cautious about that series as it's not seasonally adjusted and it could reflect the impact of the recent hurricanes."

The dollar was last up 0.56 percent against the euro at $1.1745 and up 0.15 percent against the yen at 112.64 .

The euro was also hurt after a violence-marred independence vote in Spain's Catalonia region fueled anxiety over political risk in the euro zone.

Spanish Prime Minister Mariano Rajoy faces the country's biggest constitutional crisis in decades after the ballot, in which Catalan officials said 90 percent of voters had chosen to leave Spain.

"Political risks in Europe have increased," said UBS currency strategist Constantin Bolz, in Zurich. However, "overall our expectation is that it will not have a dramatic, long-lasting impact."

The prospect of US tax reform and the likelihood of a further interest rate hike in December also boosted the greenback.

The White House on Wednesday unveiled a long-awaited Republican tax reform framework that calls for lower tax rates for businesses and individuals.

US President Donald Trump is also ramping up his search for a new chief for the US central bank, meeting with former Federal Reserve Governor Kevin Warsh, who is seen as more hawkish than current Fed Chair Janet Yellen.

Yellen is also among three others under consideration for the job.

Technical analysts at Citigroup noted that US Treasuries ended September with higher yields than were reached the previous month, making further yield rises likely.

That should translate to further dollar gains against the yen as the currency pair is correlated with bonds, and after the greenback posted a bullish reversal against the Japanese currency in September, the analysts, including Tom Fitzpatrick, said in a report.

 

 

 

Copyright Reuters, 2017
 

 

 

 

Comments

Comments are closed.