The stock market crashed this week and the US dollar followed. While the greenback recovered somewhat by the weekend, the US currency ended the week among losers.
US President Donald Trump criticized the Federal Reserve for raising interest rates, saying that there is no inflationary pressure to warrant such actions. Market analysts considered Trump’s comments one of the major reasons for the dollar’s decline. Macroeconomic data seemed to support Trump’s claims as consumer inflation trailed expectations. The greenback recovered somewhat on Friday after the stock sell-off halted.
Unsurprisingly, the Japanese yen ended the week strong amid ensuing risk aversion. What was puzzling, the Australian and New Zealand dollars, which are usually susceptible to risk-negative sentiment, also ended the week among the strongest currencies.
USD/JPY dropped from 113.78 to 112.17 over the week. AUD/USD climbed from 0.7054 to 0.7112, and NZD/USD advanced from 0.6439 to 0.6505, touching the weekly high of 0.6533.
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