The US Dollar rose on Friday after the release of strong US manufacturing data and the weakness of the euro zone. This comes hours before an important meeting between US and Chinese presidents on the sidelines of the G-20 summit.
The dollar index, which tracks the performance of the greenback against a range of major currencies, rose 0.51% to reach 97.20 points. The dollar remained on track to modest gains over November. The Chicago PMI, an important indicator provided by the Institute of Supply Management (ISM) rose to 66.6 in November from 58.4 in the previous month, beating economists’ expectations of 58.6.
The better than expected regional manufacturing data comes as investors focus on the G20 summit in Argentina, where President Donald Trump and Chinese President Xi Jinping will meet to discuss the trade issues between the two countries. Trump said he was optimistic that there were good signs of talks with China. Previously, Trump’s management had said it intended to increase current tariffs by 10 percent on Chinese imports by January next year, which could lead to a new escalation in tensions between the world’s two largest economies.
The US dollar gained more support as the euro fell, as euro-zone inflation data eased economists’ expectations that the ECB might adopt a more aggressive view of monetary policy in the near future. The single European currency fell against the dollar by 0.74%, with EUR/USD reaching $1.1311 per euro.
The pound also fell against the US dollar by 0.31% despite the release of better than expected UK housing data, with GBP/USD reaching $1.2749 per pound, mainly due to recent Brexit issues.
USD / CAD rose 0.13% amid falling oil prices and weaker than expected Canadian economic data, which came in weaker than expected and affected Canadian dollar prices. The greenback was also higher against the yen at 0.16%, with the dollar / yen trading at 113.66 yen per dollar.