Dollar Strengthens Amid Rising Import Prices and Trade Tensions
The dollar gained strength on Friday following a rise in U.S. import prices and subdued consumer sentiment. This marks its fourth consecutive weekly gain despite global trade uncertainties. Economists were surprised by the import price rise, while inflation expectations also increased, emphasizing the complex economic environment.
The dollar rose on Friday, buoyed by the latest economic data which revealed a surprising uptick in import prices, while consumer sentiment remained lackluster. The currency heads for its fourth straight weekly advance, amid ongoing global trade uncertainties.
The U.S. Labor Department reported a 0.1% increase in import prices last month, contradicting economist projections of a 0.4% drop. This unexpected rise predominantly attributed to capital goods costs counterbalancing lower energy prices.
Additionally, consumer inflation expectations have surged to 7.3% from 6.5%, against a backdrop of eased trade tensions following a temporary tariff pause between the U.S. and China. Market sentiments remain cautious as experts adjust their rate cut predictions for the Federal Reserve.
(With inputs from agencies.)
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