USD at multi month highs as market looks towards busy week of data

The US Dollar kicked off the week on a robust note, reaching multi-month highs against most of its counterparts following the release of the latest ISM manufacturing PMI. The data surpassed forecasts and indicated a return to growth for the first time in 16 months.

However, on Tuesday, the US Dollar weakened as profit-taking ensued, with investors capitalizing on the currency's recent surge to its highest level since November 14th.

In the afternoon, the latest US job openings figure failed to buoy the 'Greenback', despite surpassing forecasts. USD exchange rates continued to remain under pressure.

On Wednesday, the US dollar tumbled following the release of the latest ISM services PMI data, which came in below market expectations.

The data reported a slowdown in growth levels rather than a slight expansion as previously expected, which saw the US dollar suffer notable losses.

On Thursday, the Greenback continued its decline following dovish comments from Federal Reserve Chair Jerome Powell.

USD also encountered additional selling pressure in the afternoon session, as the latest initial jobless claims figure rose more than expected.

The US Dollar concluded the week by surging against the majority of its counterparts after the release of the latest domestic non-farm payrolls data.

March's figure soared beyond expectations, with 303,000 new jobs created in March, significantly surpassing predictions of a more modest 200,000.

Furthermore, the latest unemployment figures for March remained unchanged at 3.8%, defying predictions of a rise to 3.9%. This provided additional support to the Greenback.

Looking ahead this week, the primary driver of movement for the US Dollar exchange rate this week is expected to be a surge of US macroeconomic data.

The latest US headline and core inflation data for March is set to be released on Wednesday, with forecasts indicating a slight cooling. If the data prints as expected, this could potentially weaken USD exchange rates in mid-week trading.

Also slated for release on Wednesday are the Federal Reserve's latest interest rate decision meeting minutes. Any additional guidance on monetary policy could inject volatility into the Greenback.

On Thursday, the forecast for the latest domestic PPI data for March suggests a decline from 0.6% to 0.3%. Such a development could potentially weigh on the American currency towards the latter stages of the week.

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