Despite decreasing US Treasury bond rates on Thursday, the dollar recovered ground versus its competitors early Friday. The US Dollar Index registers moderate daily gains close to 106.00 ahead of July’s crucial US employment data. There won’t be any significant data releases on the European docket, and the market is still in a somewhat bullish mood, with US stock index futures trading in the green. The benchmark 10-year US Treasury note yield is just below 2.7 percent, which enables the dollar to maintain its strength in the early hours of European morning.
Following its policy meeting in August, the Bank of England (BOE) stated on Thursday that it had increased its benchmark interest rate by 50 basis points to 1.75 percent. However, the BOE said in its updated predictions that it expects the UK economy to enter a recession in the last quarter of the year. The British pound suffered significant losses due to the bleak economic outlook. GBP/USD hit a daily low of 1.2065 before mounting a comeback on further dollar weakening in the afternoon. At the time of publication, the pair was oscillating close to 1.2150.
EUR/USD rose almost 50 pips on Thursday but could not maintain its positive momentum. However, the pair is still trading at over 1.0200. German statistics earlier in the day revealed that industrial output rose by 0.4% in June, but this finding had little to no effect on the value of the common currency.
Gold rose to a new monthly high on dropping US Treasury bond rates, closing in on $1,800. While XAU/USD waits for the next trigger, it seems to have entered a consolidation period at $1,790.
USD/JPY is just a bit higher and is trading above 133.00 early on Friday. On Thursday, the pair ended the day in a terrible place. Early in the Asian session, statistics from Japan showed that the Leading Economic Index fell from 101.2 in May to 100.6 in June.
The USD/CAD pair could not gain on the dollar’s overall weakness as dropping crude oil prices impacted the commodity-sensitive Canadian currency. It is challenging for the pair to go higher given the price of West Texas Intermediate, which has dropped about 10% this week, was last seen increasing 1.8 percent on the day at $89.30. Later in the day, Statistics Canada is anticipated to release data showing that the unemployment rate increased to 5% in July from 4.9% in June.
Bitcoin finished the first four days of the week with little losses, then surged past $23,000 early Friday, increasing roughly 3% daily. Ethereum gained momentum and rose near $1,700 on Friday after falling below $1,600 on Thursday.