U.S. dollar softens as traders await debt ceiling vote

  • World
  • Wednesday, 31 May 2023

NEW YORK, May 30 (Xinhua) -- The U.S. dollar weakened on Tuesday as traders waited for the vote on the debt ceiling deal in Congress.

The dollar index, which measures the greenback against six major peers, fell 0.10 percent to 104.1665 in late trading.

Although there was some progress by way of a deal, some Republicans stated that they would resist the deal within the Republican-dominated House.

In addition to the debt negotiations, the market has refocused on inflation.

U.S. Consumer Confidence Index in May slowed to 102.3 from 103.7 in April, but higher than forecast consensus of 100, according to data issued by The Conference Board on Tuesday.

"Consumer confidence declined in May as consumers' view of current conditions became somewhat less upbeat while their expectations remained gloomy," said Ataman Ozyildirim, senior director of economics at The Conference Board.

The report showed that Americans' inflation expectations remain elevated but stable at a 6.1 percent average over the next 12 months.

High inflation probably won't dissipate quickly barring a sharper slowdown in the U.S. economy, said Thomas Barkin, president of the Federal Reserve Bank of Richmond on Tuesday.

"It is going to be more stubborn than many people would hope. There is a lot of uncertainty of where rates need to go," said Barkin, though he called the current interest rate level "restrictive."

The euro managed to rebound from multi-week lows despite the disappointing economic sentiment in the euro zone for May, which decreased to 96.5 from 99 in April.

In late New York trading, the euro rose to 1.0719 dollars from 1.0709 dollars in the previous session, and the British pound was up to 1.2392 dollars from 1.2357 U.S. dollars in the previous session.

The U.S. dollar bought 139.8380 Japanese yen, lower than 140.3940 Japanese yen of the previous session. The U.S. dollar rose to 0.9062 Swiss francs from 0.9041 Swiss francs, and it rose to 1.3602 Canadian dollars from 1.3593 Canadian dollars. The U.S. dollar rose to 10.8802 Swedish Krona from 10.8185 Swedish Krona.

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