Dollar slips on poor US data
NEW YORK: Disappointing data on US income and consumption growth in September helped push the dollar a bit lower on Friday, as it bolstered the argument against a December Federal Reserve rate increase.
The dollar slipped to $1.1003 against the Euro and to 120.67 yen. The British pound also pushed up against the greenback, to $1.5429.
The consumer income and spending rose only by 0.1 percent in the United States last month, less than expected and the slowest rate since January.
While the sluggish pace could be temporary, Jay Morelock of FTN Financial said both income and consumer spending could prove to be weak points in economic growth in the fourth quarter.
“Lackluster growth in both prices and consumption are indicative of a steady economy, not one that needs slowing”, Morelock said.
He said that it will be difficult for the Fed to justify rate hikes at a time when income, consumption, and inflation growth are trending lower, leaving a December rate hike less likely than prior to this release.