Economy

Dollar firms after Fed chair's upbeat remarks, global stocks gain

Dollar firms after Fed chair's upbeat remarks, global stocks gain

"As always, our actions will depend on the economic outlook, which may change as we receive new data", he said, adding that the usa economy has grown "at a solid pace" so far this year, with a strong job market and inflation close to the central bank's objective.

"With a strong job market, inflation close to our objective and the risks to the outlook roughly balanced, the FOMC believes that - for now - the best way forward is to keep gradually raising the federal funds rate", Powell said in his prepared testimony. It signaled last month that it expected two more hikes this year. "But nonetheless, it has significant effects on the economy".

Powell repeated on Wednesday that rising world protectionism would over time pose a risk to a United States and global expansion that now appears largely on track to continue.

"The economy is still good and interest rate still up, so that's good for the USA dollar and negative for gold for the time being". The precious metal, that is considered as a safe haven at times of uncertainties, however, did not surprisingly gain from the trade war between the USA and its allies when most global financial markets tumbled.

Reaching a denuclearization deal with North Korea "may take some time", U.S. Secretary of State Mike Pompeo said on Wednesday, reiterating that sanctions would continue to be enforced in the meantime, even as Russia's envoy to Pyongyang proposed discussions on easing them.

Pure gold (99.9 purity) also eased by a similar margin to finish at Rs 30,205 per 10 grams as against Rs 30,330 yesterday. The unemployment rate is historically low and expected to decline further.

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The euro was up 0.07 percent at 89.11 pence against sterling, moving back toward the four-month high of 89.31 pence it hit the previous day.

- Wage growth at last?

He noted that the number of people in the workforce had remained stable, which is "a sign of labor market strength", given the retirement of the baby boom generation which is taking workers out of the labor force.

The US economy hasn't been this healthy since the financial crisis.

After yesterday's brief pause, led by disappointing US housing market data, a fresh wave of US Dollar buying interest emerged on Thursday and was one of the key factors prompting some aggressive selling around dollar-denominated commodities - like gold.

"Currency weaknesses are resulting in outperformance for European indices against their U.S. counterparts", Joshua Mahony, market analyst at IG, said. "Higher short-term interest rates make the dollar more attractive relative to other currencies".