The US dollar strengthened on Friday continuing to strengthen after U.S. personal income and spending data. recorded good performance and market players also started taking profits.
The US dollar index was down 2.4% in April and was among the worst monthly performances since July 2020.
The data report showed a 4.2% increase in U.S. consumer spending. in March, amid a 21.1% jump in income as households received COVID-19 assistance money. This led to a 0.4% increase in the personal consumption expenditure index.
On the other hand, the Fed’s chairman Jerome Powell remained adamant on his stance on interest rates and monetary easing policy on Thursday. This makes market players unhappy to sit on the outlook for inflation.
Apart from that, the performance of the US dollar was also driven by the Purchasing Management Index (PMI) data which showed a good reading for April which recorded a reading of 72.1, the highest reading in almost four decades.
After the Fed’s policy meeting on Thursday, Powell acknowledged that the U.S. economy is growing but has yet to show enough evidence to make a policy change. This is in contrast to the Central Bank of Canada taking steps to reduce asset purchases.
The US dollar index, which measures the greenback against other currencies, was strong by 0.73% to the exchange rate of 91.257 as of 11.40 p.m.
