The U.S. dollar fell further on Friday, widening its weekly losses, as investors continued to move away from the currency in favor of other assets. The greenback has been under pressure for several weeks, as investors have become increasingly concerned about the outlook for the U.S. economy and the impact of the ongoing trade war with China.
The U.S. dollar index, which measures the greenback against a basket of other major currencies, fell 0.3 percent on Friday, bringing its weekly losses to 1.3 percent. The index is now at its lowest level since late April, and is down nearly 5 percent since the start of the year.
The decline in the dollar has been driven by a number of factors, including a weakening U.S. economy and rising concerns about the trade war with China. The U.S. economy has been slowing in recent months, with growth in the first quarter coming in at just 3.2 percent, down from 4.2 percent in the fourth quarter of 2018.
At the same time, the trade war between the U.S. and China has been escalating, with both sides imposing tariffs on each other’s goods. The uncertainty surrounding the trade war has weighed heavily on investor sentiment, and has caused investors to move away from the dollar in favor of other assets such as gold and the Japanese yen.
The decline in the dollar has also been driven by a stronger euro and British pound. The euro has been rising in recent weeks on expectations that the European Central Bank will soon begin to ease monetary policy, while the British pound has been buoyed by hopes that a Brexit deal can be reached before the October 31 deadline.
The weakening dollar could have a number of implications for the global economy. A weaker dollar makes U.S. exports more competitive, which could help boost economic growth in the short-term. At the same time, it could also lead to higher inflation, as imported goods become more expensive for U.S. consumers.
Overall, the U.S. dollar continues to weaken, and its losses are likely to continue in the near-term as investors remain concerned about the outlook for the U.S. economy and the ongoing trade war with China.
Source: Plato Data Intelligence: PlatoAiStream
Clarida Expects No Fed Blackout and Forecasts One or Two Rate Hikes Ahead, According to Forexlive.
Richard Clarida, the Vice Chairman of the Federal Reserve, recently stated that he does not expect a Fed blackout and...