Investing.com - The euro rose against the dollar on Friday, buoyed by robust euro zone inflation figures, while the dollar pushed higher against the yen as solid U.S. wage data offset figures showing that economic growth slowed in the first three months of 2017.
EUR/USD was up 0.21% to 1.0896 late Friday, not far from the five-and-a-half month highs set earlier in the week.
The annual rate of inflation in the euro area rose by 1.9% in April, Eurostat said, the highest level in over three years.
Core inflation rose by a stronger-than-forecast 1.2% year-on-year, the highest level since September 2013.
The upbeat data fueled expectations that the European Central Bank could adopt a more hawkish stance at its next policy meeting in June.
USD/JPY was up 0.23% at 111.52 after the Department of Labor reported that the employment cost index, the broadest measure of labor costs, increased 0.8% in the first quarter, the largest increase since the fourth quarter of 2007.
The data offset another report showing that the U.S. economy posted its slowest growth in three years in the three months to March, with gross domestic product growing at a 0.7% annual rate.
The slowdown was due in large part to a near-stagnation in consumer spending, which grew by just 0.3%.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, slid to 98.89 late Friday.
Sterling ended the week at seven-month highs against the dollar, with GBP/USD up 0.38% at 1.2951 in late trade.
The pound shrugged off data pointing to a showdown in UK growth at the start of the year as higher inflation, which has risen sharply since the Brexit vote, eroded consumer spending.
UK GDP grew by just 0.3% in the first quarter, down from 0.7% in the three months to December.
Demand for sterling continued to be underpinned in the run-up to the election called by Prime Minister Theresa May, who says she wants to strengthen her hand ahead of Brexit negotiations.
In the week ahead, markets will be paying close attention to Friday’s U.S. nonfarm payrolls report as well as Wednesday’s policy statement by the Federal Reserve.
The euro zone is to release data on first quarter growth and the UK is to publish survey data that will further show the economic impact of last year’s Brexit vote.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, May 1
Financial markets in Shanghai, Hong Kong and Europe will be closed for holiday.
The European Commission is to release its economic forecasts for the European Union area.
U.S. Treasury Secretary Steven Mnuchin is to speak at an event in Los Angeles.
The U.S. is to release data on personal income and expenditure.
Later Monday, the Institute for Supply Management is to publish its manufacturing index.
Tuesday, May 2
China is to publish its Caixin manufacturing PMI.
The Reserve Bank of Australia is to announce its benchmark interest rate and publish a rate statement which outlines economic conditions and the factors affecting the monetary policy decision.
The UK is to release data on manufacturing activity.
Wednesday, May 3
Financial markets in Japan and Hong Kong will be closed for holidays.
New Zealand is to publish its quarterly employment report.
The euro zone is to publish a preliminary estimate of first quarter economic growth.
The UK is to release data on construction activity.
The U.S. is to release the ADP nonfarm payrolls report for January and the ISM is to release its non-manufacturing PMI.
The Federal Reserve is to announce its benchmark interest rate and publish a monetary policy statement.
Thursday, May 4
Financial markets in Japan will be closed for a holiday.
Australia is to report on its trade balance.
The UK is to release data on service sector activity.
Canada is to publish its latest trade figures.
The U.S. is to release a flurry of economic reports, including data on initial jobless claims, the trade balance and factory orders.
ECB President Mario Draghi is to speak at an event in Switzerland.
Bank of Canada Governor Stephen Poloz is to speak at an event in Mexico.
Friday, May 5
Financial markets in Japan will be closed for a holiday.
The RBA is to publish its monetary policy statement.
New Zealand is to release data on inflation expectations.
Canada is to produce its monthly employment report and the Ivey PMI.
The U.S. is to round up the week with the non-farm payrolls report for April and Fed Chair Janet Yellen is to speak at an event in Providence. Fed Vice Chair Stanley Fischer is to speak at an event in Stanford.