TheÂ US dollar is continuing toÂ post incredible gains against several currencies onÂ Thursday after anÂ impressive week ofÂ domestic economic data andÂ global developments. TheÂ greenback will now look ahead toÂ theÂ September jobs report onÂ Friday, which is expected toÂ come inÂ strong.
According toÂ theÂ Institute forÂ Supply Management (ISM), business activity inÂ theÂ non-manufacturing sector is firing onÂ all cylinders asÂ it expanded atÂ aÂ faster pace inÂ September compared toÂ theÂ previous month. TheÂ Purchasing Managersâ Index (PMI) swelled toÂ 61.6 from 58.5, beating theÂ market forecast ofÂ 58 andÂ reaching its best level since April 2006
Other key aspects ofÂ theÂ report saw theÂ Non-Manufacturing Business Activity Index jumped toÂ 65.2%, theÂ New Orders Index advanced toÂ 61.6%, theÂ Employment Index ballooned toÂ 62.4%, andÂ theÂ Prices Index rose toÂ 64.2%
Last month, private-sector employment skyrocketed, reports Automatic Data Processing (ADP) asÂ employers added 230,000 jobs, theÂ highest hiring rate since February, beating theÂ market forecasts ofÂ 179,000.
TheÂ news helped theÂ equities market post new highs, leading President Donald Trump toÂ tweet: âBlowout numbers onÂ New Jobs, and, separately, Services. Market up!â
Speaking inÂ anÂ interview with PBS host Judy Woodruff onÂ Wednesday, Federal Reserve Chair Jerome Powell suggested that theÂ central bank is ready toÂ raise interest rates even higher andÂ that it might go past neutral.
TheÂ really extremely accommodative low interest rates that we needed when theÂ economy was quite weak, we don’t need those anymore. They’re not appropriate anymore.
Interest rates are still accommodative, but we’re gradually moving toÂ aÂ place where they will be neutral. We may go past neutral, but we’re aÂ long way from neutral atÂ this point, probably.
TheÂ remarks have helped Treasury notes asÂ theÂ 10-year Treasury note yield surged 0.16% toÂ aÂ seven-year high ofÂ 3.19%.
While theÂ US Dollar Index has taken aÂ hit ofÂ 0.2% toÂ 95.80, theÂ buck has gained against its counterparts.
TheÂ USD/CAD currency pair rose 0.42% toÂ 1.2925, from anÂ opening ofÂ 1.2868. TheÂ EUR/CAD climbed 0.24% toÂ 1.1508, from anÂ opening ofÂ 1.1479.
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