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HomeEconomyDollar pauses broad gains, bulls remain firmly positioned

Dollar pauses broad gains, bulls remain firmly positioned

Rae Wee

SINGAPORE (Reuters) – The dollar took a breather on Tuesday after a broad rally, pulling back slightly from milestone highs in the euro, yen and sterling, but not too far Interest rates in Europe and the U.S. are expected to rise sharply as a recession looms.

The euro rose 0.4% to $0 after taking a hit in early Asian trade. 9963 fell to a two-decade low of $0 on Monday. 9876 Winter prospects bleak without Russian gas.

Overnight trading weakened by holiday In US and Asian session on Tuesday the highlight will be the RBA meeting, the market is priced at around 27 27 Percent chance of a rate hike in basis points.

Russia has halted the flow of natural gas along Nord Stream to Germany indefinitely, initially blaming oil leaks at compressor stations but linking the shutdown on Monday to sanctions imposed by the West.

Pound hits 2-1/2-year low of $1. 109 News, but up 0.5% in Asia to $1. 64. Liz Truss became Britain’s new prime minister after winning a leadership vote on Monday, and her promise of tax cuts has added uncertainty to government finances.

“Existing choices need to be made now because they may not be enough,” said Michael Every, global strategist at Rabobank.

“These choices are clearly unpleasant. “

The dollar index fell 0.2% to 109. 46 rise to46 27 on Monday. As the pace of U.S. rate hikes picks up and widens the gap with the peg in Japan, the Yuan fell, and the last transaction price was 140.27 per dollar, not far from – 140 year low.27 touched last week.

Chinese authorities have stepped up their resistance to the appreciation of the dollar and lowered the foreign exchange reserve requirement (RRR) late Monday to make room for banks to sell dollars.

Impact of the move on the exchange rate Limited, the yuan was steady at 6 in offshore trade. 9412.

The Australian and New Zealand dollars were up about 0.5% in early trade, Although analysts don’t believe Australia’s sharp rate hike will take the market too far.

AUD was last up 0.4% at $0. 6826 and Kiwi rose 0.5% to $0. 6121.

“Overall, the reaction of currencies outside the U.S. to rising interest rates in recent months, even if they have exceeded expectations, seems to have produced only Temporary impact,” said Ray Attrill, head of FX strategy at National Australia Bank (OTC: NABZY).

“I think the key is obviously the language of the statement. ”



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