The U.S. dollar experienced a significant decline following a disappointing jobs report, revealing weakness in the economy. As of Friday, the dollar was down nearly 9% year-to-date against the DXY currency index, despite recent gains. The dollar fell from 100.22 on the DXY to 98.82, marking its largest one-day drop since May 23. Analysts forecast a potential 25 basis point rate cut from the Federal Reserve, amid concerns over the reliability of U.S. economic data and its impact on asset markets.
The dollar index suffered its biggest one-day drop since May 23 as markets swiftly reassessed the outlook for rates and growth.
Friday's soft jobs report knocked the stuffing out of the dollar's rally. Investors now attach an 80% probability to a 25bp rate cut from the Federal Reserve in September.
Uncertainty about the quality of U.S. data is not a good look for U.S. asset markets and could add some more risk premium both into the dollar and Treasuries.
Goldman Sachs called it 'USD: Whiplash week.' The bank forecasted U.S. GDP growth would be only 1% in the second half of the year.
Collection
[
|
...
]