News: FOREX-U.S. dollar climbs to 9-month peak on Fed taper view, Delta virus

  1. 184,650 Posts.
    lightbulb Created with Sketch. 2711
    • Fed minutes show officials considering taper this year
    • U.S. jobless claims fall to 17-month low
    • Commodity currencies fall vs U.S. dollar

    (Adds new comment, U.S. data, FX table)

    The U.S. dollar advanced to a nine-month high on Thursday, as worries about widespread coronavirus infections and Federal Reserve meeting minutes showing policymakers considering reducing pandemic-era stimulus this year hit global stocks and commodity-linked currencies.

    The dollar index =USD , which measures its performance against six currencies, hit 93.434, its highest since early November last year. It was last up 0.2% at 93.273.

    "The U.S. dollar is broadly stronger today against the non-haven currencies with a strong risk-off tone in markets that are roiled by the spread by the Delta variant," Shaun Osborne, chief FX strategist at Scotiabank in Toronto, wrote in a research note.

    "Preparations for the beginning of the Fed's tapering cycle may also not be helping," he added. The minutes of the Fed's July meeting showed officials largely expect to reduce their monthly bond buying later this year, but consensus on other key issues appeared elusive, including the timing of the start of the taper and whether inflation, joblessness or the coronavirus pose a bigger risk to economic recovery.

    The Fed minutes, along with sustained worries about the spread of the coronavirus, pushed Wall Street stock indexes lower. European markets were down as well on Thursday, while safe-haven U.S. Treasuries gained, with benchmark 10-year yields nearly 3 basis points lower at 1.246% US10YT=RR .

    The dollar hardly reacted to data showing weekly unemployment claims showed the number of people on state jobless rolls dropped in early August to levels last seen in mid-March 2020.

    The euro EUR=EBS fell as low as $1.1665 against the dollar for the first time since Nov. 4 and was last down 0.1% at $1.1699, while sterling fell 0.7% to $1.3679 GBP=D3 .

    The reduction in debt purchases is also widely considered positive for the dollar as it is expected to raise U.S. government bond yields, making it more attractive for investors to hold dollar-denominated assets.

    That said, Commerzbank analyst Antje Praefcke noted that the minutes provided little insight compared to what regional Fed chairs have recently said.

    "The market will presumably only receive more detailed news in September when the Fed publishes its new projections and dot plots," she said.

    "Until then, it makes more sense to keep an eye on the current developments of the pandemic and economic data," Praefcke added.

    With pandemic fears in focus and oil prices falling, commodity-exposed currencies fell sharply on Thursday.

    The Norwegian crown extended its fall against the euro even as the country's central bank kept interest rates on hold and reiterated plans to hike them in September.

    It fell more than 1% to the lowest since July against the euro at 10.5405 crowns and dropped similarly against the U.S. dollar. EURNOK=D3 NOK=D4

    The Australian and New Zealand dollars each fell more than 1% to their lowest levels since November 2020 at US$0.7144 and US$0.6810, respectively AUD=D3 NZD=D3 .

    The Kiwi dollar extended its losses, when New Zealand entered a new lockdown, delaying its central bank from becoming the first in the G10 from raising rates during the pandemic.

    	======================================================== 
    	Currency bid prices at 10:10AM (1410 GMT) 
    
     Description	  RIC		 Last		   U.S. Close  Pct Change	 YTD Pct	   High Bid	Low Bid 
    											  Previous				   Change					
    											  Session											  
     Dollar index	  =USD	   93.4050		93.2240	 +0.21%		 3.805%		+93.5020	+93.2140 
     Euro/Dollar	   EUR=EBS	$1.1691		$1.1709	 -0.15%		 -4.31%		+$1.1716	+$1.1666 
     Dollar/Yen		JPY=EBS	109.8200	   109.7600	+0.06%		 +6.29%		+110.2200   +109.4900 
     Euro/Yen		  EURJPY=	128.38		 128.51	  -0.10%		 +1.15%		+128.7000   +127.9400 
     Dollar/Swiss	  CHF=EBS	0.9181		 0.9172	  +0.13%		 +3.80%		+0.9207	 +0.9146 
     Sterling/Dollar   GBP=D3	 $1.3678		$1.3752	 -0.54%		 +0.12%		+$1.3757	+$1.3666 
     Dollar/Canadian   CAD=D3	 1.2764		 1.2664	  +0.79%		 +0.24%		+1.2772	 +1.2649 
     Aussie/Dollar	 AUD=D3	 $0.7175		$0.7234	 -0.83%		 -6.74%		+$0.7243	+$0.7145 
     Euro/Swiss		EURCHF=	1.0733		 1.0734	  -0.01%		 -0.68%		+1.0746	 +1.0697 
     Euro/Sterling	 EURGBP=	0.8545		 0.8511	  +0.40%		 -4.39%		+0.8555	 +0.8506 
     NZ				NZD=D3	 $0.6847		$0.6885	 -0.52%		 -4.62%		+$0.6888	+$0.6810 
     Dollar/Dollar																					 
    
     Dollar/Norway	 NOK=D3	 9.0020		 8.8965	  +1.16%		 +4.81%		+9.0230	 +8.9250 
     Euro/Norway	   EURNOK=	10.5252		10.4231	 +0.98%		 +0.56%		+10.5579	+10.4150 
     Dollar/Sweden	 SEK=	   8.7940		 8.7281	  +0.61%		 +7.29%		+8.7964	 +8.7236 
     Euro/Sweden	   EURSEK=	10.2809		10.2183	 +0.61%		 +2.03%		+10.2859	+10.2153 
    	<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ 
    World FX rates	https://tmsnrt.rs/2RBWI5E 
    
    	^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>                    
 
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.