Investing.com – The U.S. dollar traded with small losses on Friday but remained on track for weekly gains as traders reassess likely Federal Reserve rate cuts in the wake of strong payroll data.
At 04:30 ET (08:30 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, was trading 0.2% lower at 102.594.
This week, the index is on track to rise 0.4%, building on the previous week’s gain of more than 2%.
PPI details follow
The dollar has been in demand since last week’s strong report, with traders largely ruling out the chance of another big rate cut at the next meeting.
While Thursday’s rise raised some doubts about the health of the labor market, the rally among stock traders was a reminder that inflation could still be a problem.
The figures will be released later in the session and are likely to show a small gain, but there is a degree of uncertainty following slightly stronger than expected consumer inflation in September.
For now, expectations for a Fed rate cut on November 7 have risen to 83.3% from 80.3% a day earlier, with remaining chances for stable policy remaining, according to data from CME Group (NASDAQ:) .
The British economy is returning to growth
In Europe, yields rose 0.1% to 1.3068 after data showed the British economy returned to growth in August after two consecutive months of no growth.
rose 0.2% month-on-month in August, largely in line with expectations, and grew 1.0% from a year ago.
The British economy now appears to be on track for a third consecutive quarter of economic growth. The ONS said September GDP data would need to show a month-on-month decline of 0.3% to 0.6% to generate a flat quarterly reading, assuming no revisions to existing figures take place.
traded 0.1% higher at 1.0944, after falling to 1.8% in September, the federal statistics agency said on Friday, confirming preliminary data.
With inflation in the euro zone’s largest economy below the European Central Bank’s target and growth stagnating, the ECB is widely expected to ease policy again next week, having already cut interest rates twice this year.
“While arguments against a rate cut should not be entirely dismissed, it would now take a lot of courage from the ECB to hold on as the markets and consensus are fully in line with a 25 bp cut,” ING analysts said . remark.
Yuan wins before the briefing
fell 0.1% to 148.75 after reaching close to 150 yen earlier this week, a level not seen since August 2.
fell 0.2% to 7.0672, with the yuan rising slightly ahead of an upcoming Finance Ministry briefing where the government said it will outline plans for fiscal stimulus.
Analysts expect Beijing to provide at least 2 trillion yuan ($283 billion) in budget support, with much of the amount earmarked to support private consumption.
