SINGAPORE- A buoyant dollar pushed the yen to a 10-month trough on Thursday and kept the euro and sterling pinned near three-month lows, as investors placed their faith in a still-resilient US economy even amid a dour global growth outlook.
A less-than-expected fall in China’s exports and imports numbers in August did little to lift investors’ spirits, as they remain on the lookout for further support measures from Beijing to shore up the economy and revive market confidence.
The greenback scaled a fresh top of 147.875 yen in early Asia trade, its highest since last November.
Against a basket of currencies, the dollar steadied at 104.82, holding on to some of its gains from the previous session after scaling a six-month peak as the US services sector unexpectedly gained steam in August.
The stronger-than-expected data pushed the euro to its lowest since June at $1.0703 on Wednesday, though it reversed some of those losses to last trade at $1.07295.
Sterling slipped 0.06 percent to $1.2500, having also bottomed at a three-month trough of $1.24835 in the previous session.
“It certainly was a good (ISM) … so those thinking of a (US) recession in the near term might be a little bit disappointed,” said Joseph Capurso, head of international and sustainable economics at Commonwealth Bank of Australia (CBA). “However, the Beige Book … wasn’t that great, actually.”
US economic growth was “modest” in recent weeks, job growth was “subdued,” and inflation slowed in most parts of the country, the Federal Reserve report published on Wednesday showed.
“I think that what’s really driving the dollar is not so much that the US economy is doing great, but it’s doing better than elsewhere.”
