A mixed week for the US dollar too, falling against sterling and the Swiss franc but neutral against the euro.
The dollar has also been hit by expectations that the central bank will slacken off its interest rate rises amidst signs of economic downturn. Investors have been buying riskier assets, including bitcoin, which has surged to a two-month high (although it remains at half the value of 2022’s highs).
Lael Brainard, the vice chair of the Federal Reserve, said yesterday that she was hopeful on inflation, citing non-wage causes as driving inflation and that these are likely to fade fast in 2023.
It’s been a little quiet for US data this week, although yesterday we saw a drop in the number of building permits, 1.33 million compared to last month’s 1.35 million, and well below market expectations. Retail sales fell in a similar fashion to the UK’s in December.
Next week starts exceptionally quiet for data, until Thursday’s GDP reading.
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USD/GBP past year
