The dollar moved higher on Friday following a reading of US consumer sentiment amid several comments from Federal Reserve officials, with the focus now shifting to this week’s key inflation reading.
 
The greenback reversed its decline and turned higher after the preliminary University of Michigan reading on consumer sentiment came in at 67.4 for May, the lowest in six months and below the expected 76.0 by economists surveyed by Reuters. Additionally, one-year inflation expectations rose to 3.5% from 3.2%.
 
The dollar had weakened on Thursday after a higher-than-expected reading on initial jobless claims sparked expectations of a loosening labor market, adding to other recent data indicating the overall economy is slowing.
 
The dollar index, which measures the greenback against a basket of currencies, rose 0.09% to 105.31, with the euro down 0.08% at $1.0772. The dollar is on track for its first weekly gain after two consecutive weeks of decline.
 
This week, investors will be watching inflation readings in the form of the Consumer Price Index (CPI) and the Producer Price Index (PPI), as well as retail sales data.
 
Meanwhile, the dollar was also supported by comments from Dallas Federal Reserve President Lorie Logan, who stated that it is unclear whether monetary policy is tight enough to bring inflation to the central bank’s 2% target and that it is too early to cut interest rates.
 
Following a softer-than-expected US jobs report and the FED’s policy announcement, the market has priced in about a 50 basis point (bps) cut this year, with a 62.2% chance of at least a 25 basis point cut in September, according to the CME FedWatch tool.
 
Against the Japanese yen, the dollar strengthened 0.26% to 155.86 and rose about 1.9% for the week against the Japanese currency after falling 3.4% last week, marking the largest weekly decline since early December 2022 following two suspected interventions by the Bank of Japan.
 
Japanese Finance Minister Shunichi Suzuki stated on Friday that the government will take appropriate action on foreign exchange if necessary, echoing recent comments from other officials.

GOLD



Gold prices rose close to $2,360 per ounce on Monday, trading at their highest level in three weeks, driven by expectations of a Federal Reserve interest rate cut following weak US employment figures. Last week, data showed a larger-than-expected increase in jobless claims, indicating a slowdown in the labor market.

Suggest: SELL 2363.00 TP1 2360.00 TP2 2355.00 SL 2366.00


USDJPY




The Japanese yen stabilized around 155.6 per dollar as investors reacted to the Bank of Japan's policy meeting summary from April, where the board noted upside risks to inflation and discussed scenarios that may require further interest rate hikes. The report also highlighted the yen's weakness as a key factor in driving up prices, drawing the central bank's attention.

Suggest: BUY 155.280 TP1 155.500 TP2 155.800 SL 155.000