Dollar Rules The FX Skies, Equities Undecided – Investing.com

Dollar Rules The FX Skies, Equities Undecided – Investing.com

Dollar remains king as Fed shockwaves reverberate Stocks caught in limbo, oil prices wary of supply risksSecond-tier data coming up today, but could be crucial

Dollar reigns supreme

The trading week is coming to a close with the dollar ruling the skies over the FX battleground, after a shocking acceleration in US inflation reignited expectations for faster Fed rate increases and served as jet fuel for the reserve currency. Markets are currently split on whether the FOMC will hike rates twice or three times next year.

As such, next week’s retail sales could be crucial in tipping the scales. Credit card data from J.P. Morgan Chase points to a solid October for spending but an incredible November as some consumers may have started holiday shopping early, fearful of delayed deliveries. Therefore, there might be more good news on the way for the dollar.

In contrast, the euro is still grappling with several risks that threaten growth. The spike in energy prices is squeezing consumers, China’s slowdown is bad news for demand in Europe’s largest export market, and soaring covid cases across the continent have just seen the Netherlands impose a partial lockdown. Germany might be next, as cases have skyrocketed lately.

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