Dollar drifts, risk-sensitive currencies lifted by China optimism
dollar wobbled on Friday, poised for a fourth straight week of declines as investors weighed U.S. data to gauge the pace of interest rate cuts, while China's spree of stimulus measures kept risk-sensitive currencies aloft.
Data on Thursday suggested the U.S. labour market remained fairly healthy, while other reports showed corporate profits increased at a more robust pace than initially thought in the second quarter, highlighting an upbeat economic outlook.
The dollar, however, remained on the back foot as traders priced in 73 basis points of easing for the rest of the year, with a 51% chance for another outsized half-percentage-point cut, according to CME Group's FedWatch Tool.
The Federal Reserve has recently signalled a shift in focus away from inflation and towards keeping the labour market healthy, delivering a larger-than-usual 50 basis point interest rate cut last week.
The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, was last at 100.67, not far from the 14-month low of 100.21 it touched on Wednesday. The index is down 0.06% this week, its fourth straight week of declines.
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