What Happened to the USD After Skyrocketing High?

<p>The US dollar remained steady in the European session despite retreating slightly from the six-month high it hit on Thursday.</p><p><br /></p><p>Earlier, the currency king surged higher after being supported by retail sales data, producer inflation (PPI) and stronger US jobless claims in August.</p><p><br /></p><p>However, it eased slightly in the Asian session following positive market sentiment following better-than-expected Chinese retail sales and industrial production data.</p><p><br /></p><p>This has pushed the yuan, the Aussie dollar and the New Zealand dollar higher, before falling slightly in the European session.</p><p><br /></p><p>In addition to the strong data, the announcement of the central bank of China (PBOC) also focused the market by making a cut of 25 basis points in the bank's reserve requirement ratio.</p><p><br /></p><p><br /></p><p>Meanwhile, the euro continued to weaken to a six-month low against the greenback after the European Central Bank (ECB) signaled that there would be no further interest rate hikes.</p><p><br /></p><p>The central bank raised rates by 25 basis points to 4.50% at its policy meeting on Thursday.</p><p><br /></p><p>Meanwhile, the pound remained hovering at a three-month low against the US dollar, with investors now gearing up for UK inflation data and the Bank of England's (BOE) policy meeting next week.</p><p><br /></p><p>In Japan, the yen weakened again with prices returning to a 10-month low of 147.87 against the US dollar that it touched last week.</p><p><br /></p><p>The Canadian dollar continued to strengthen to a new two-week high against the greenback, supported by oil prices trading at their strongest level since November 2022.</p>