The US Dollar has been bid since the release of Fridays employment report from the US. The Non-Farm Payrolls headline figure of 280,000 jobs in May, with the unemployment rate ticking slightly higher to 5.5%.
There was a gradual increase in average hourly earnings, up by 8 cent to $24.96, which should eventually put further pressures on uptick in prices. This adds to the argument, that Janet Yellen should begin the gradual tightening of policy before the year end. This is in contrast to Christine Lagarde’s view, who believes that the Federal Reserve should hold off until at least the beginning of 2016.
The US dollar has been bid against the majors, with the largest move being in USDTRY on the back of the Turkish election. The previous controlling government, AK party, lost their majority in the general election, with the Turkish Lira feeling the brunt of the uncertainty. Since the early Asian trade, the Turkish Lira has weakened, with Goldman Sachs raising their long bearish TRY view to 3.20 per dollar in 2016.
Turkish Markets: 1. USDTRY record high. 2. Turkish bond yields surge. 3. Borsa Istanbul plunges over 8% pic.twitter.com/Cr0p46cJ8Q— Jonathan Ferro (@FerroTV) June 8, 2015