NEW YORK: The US dollar edged higher on Thursday after data showed the world’s largest economy grew at a faster pace than expected in the fourth quarter, suggesting the Federal Reserve would be in no rush to cut interest rates amid a generally stable economy.
The dollar index, a gauge of the greenback’s value versus six major currencies, was last up 0.1% at 103.37. The euro, on the other hand, fell against the dollar, after mixed comments from European Central Bank President Christine Lagarde. She said it was “premature to discuss rate cuts” for the euro zone economy, but noted that the risks to economic growth remain “tilted to the downside.”
The ECB, at its policy meeting on Thursday, left borrowing costs unchanged. The single euro zone currency last traded at $1.0863, down 0.2%.
In the United States, the Bureau of Economic Analysis’s advance GDP estimate showed that gross domestic product in the last quarter increased at a 3.3% annualized rate, compared with the consensus forecasts of growth at a 2.0% rate.
“It’s only fitting that a year that defied expectations would show growth that exceeded expectations. You have to squint to see weakness in the numbers,” said Brian Jacobsen, chief economist, at Annex Wealth Management, at Menomonee Falls, Wisconsin.
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