- The US dollar strengthened on Friday
- The euro and pound sterling faced downward pressure
- Analysts remain cautious about the sustainability
The US dollar strengthened on Friday, approaching a one-week high against major currencies.
This uptick was primarily driven by better-than-expected US jobless claims data, which eased concerns about a potential economic downturn.
The positive employment figures prompted investors to reduce their bets on Federal Reserve interest rate cuts later this year.
Consequently, safe-haven currencies like the Japanese yen and Swiss franc weakened, reflecting a more optimistic market sentiment.
The dollar’s recent rally comes after a turbulent week triggered by unexpectedly soft US payroll data, which had initially sent global stocks plummeting and boosted demand for safe-haven assets.
While the dollar index was relatively stable, it remained poised for a weekly gain.
The euro and pound sterling faced downward pressure, with the latter recovering slightly from a recent low.
Meanwhile, the Australian and New Zealand dollars also weakened.
Overall, the market is shifting towards a more risk-on appetite, with investors becoming less cautious about potential economic downturns.
However, analysts remain cautious about the sustainability of this trend and the potential for future market volatility.
