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Dollar heads for longest weekly losing streak in a decade

Friday,   14-Aug-2020   02:14 PM (IST)

The dollar steadied on Friday as a spike in U.S. bond yields and a drag on risk sentiment from lacklustre Chinese economic data slowed a selldown of the U.S. currency, which was headed for its longest weekly losing streak since 2010.  China’s retail sales unexpectedly extended their fall into a seventh month in July and industrial output missed expectations - suggesting bumps in even the world’s most promising rebound. The mood had the dollar within reach of snapping a seven-week losing streak against the risk-sensitive Aussie, which settled around $0.7149, flat for the week. Tepid demand in a long-dated U.S. government bond auction on Thursday also extended a surge in Treasury yields that has drawn some investors - especially from Japan - back to dollars. U.S. retail sales data today may inject a bit of impetus, said Patel - especially as it will test the narrative that the U.S. economy will lag in the post-pandemic recovery. The yen was on course for its poorest week against the dollar in two months and down about 0.9% at 106.74 from last Friday's close. The biggest loser this week has been the kiwi, which was under pressure at $0.6538, as New Zealand deals with a fresh coronavirus outbreak. Moreover, the central bank this week flagged increased bond buying and again mentioned the prospect of negative rates. Against a basket of currencies, the U.S. dollar remains 0.2% lower for the week, but it seems to have arrested a slide that has it about 9.5% below its March peak. The dollar index was headed for its eighth consecutive week of losses, its longest weekly losing streak since June 2010.