The Dollar attempted to rally early in the N.Y. session on Thursday, taking the DXY to two-session highs of 90.58, up from overnight lows of 90.24. From there, a round of profit taking set in, seeing the USD reverse lower against major currencies. There was little initial reaction to the much worse than expected jobless claims figures, though the data later could have been a driver of Dollar weakness. Wall Street and Treasury yields were higher ahead of Biden’s address this evening, where he is expected to outline his stimulus plans, which could be in the order of $2.0 tln.

Source: XE news feed
XE Market Analysis: Asia – Jan 14, 2021

Modest weakness in the euro and yen, along with a smidgen of firmness in the Canadian dollar, were pretty much the only directional themes among the main currencies in trading through to the early London interbank session. EUR-USD edged out a two-day low at 1.2136, which is 4 pips shy of the 24-day low that was seen earlier in the week. A lift in the 10-year U.S. T-note yield back above 1.1%, alongside the continued resonance of ECB Lagarde and Villeroy’s rhetorical shot across the bows of euro bulls, seems to have maintained EUR-USD’s heaviness. U.S.

Source: XE news feed
XE Market Analysis: Europe – Jan 14, 2021

FX trade was relatively quiet in N.Y. on Wednesday, keeping the DXY inside of a 90.20 to 90.45 trading band. Incoming data saw December CPI on the cooler side of expectations, though there was little market reaction. Wall Street struggled, though into the close, the major indices were all in modestly green territory. Treasury yields came off the boil following a well-received 30-year bond auction. Looking forward, prospects for huge additional fiscal stimulus from the new Congress, along with the rollout of Covid vaccines will likely result in a faster than initially anticipated U.S.

Source: XE news feed
XE Market Analysis: Asia – Jan 13, 2021

The dollar lifted out of lows, aided by gains against the euro after ECB’s Villeroy fired a rhetorical volley across the bows of euro bulls, reminding the forex market that he and his colleagues “are monitoring with particular attention the negative effects of the euro exchange rate.” Market participants, meanwhile, overlooked a much stronger than expected Eurozone industrial production data. The ECB’s concern about euro appreciation alongside prospects for an unrestrained Biden presidency in the U.S. are grounds to reconsider the upside potential of EUR-USD.

Source: XE news feed
XE Market Analysis: North America – Jan 13, 2021

The dollar has declined for a second day, further giving back the rebound gains that were seen in the wake of the Georgia runoff elections in the U.S., and despite tomorrow’s detailing by president-elect Biden of the Democrat party’s economic stimulus plan. The dollar softened following remarks by Fed hawks Mester and George, yesterday, who pushed back on speculation that the central bank might taper its asset purchase program during 2021. U.S.

Source: XE news feed
XE Market Analysis: Europe – Jan 13, 2021

The Dollar was range bound in N.Y. on Tuesday, though ultimately ended modestly lower overall. The DXY touched 90.54 highs early in the session, later easing under 90.30 in relatively quiet trade, after being unable to breach Monday’s three-week high of 90.72. There were no major data releases to move markets. Risk-taking levels were narrowly mixed, seeing Wall Street trade either side of flat through the session.

Source: XE news feed
XE Market Analysis: Asia – Jan 12, 2021

The dollar has taken a step back, correcting some of the gains that have been seen since it become clear that the Democrats in the U.S. were going to control the Senate, in addition to the Presidency and House. Some narratives attributed this in part to reportedly large demand for China’s yuan, linked to the proximity of the one-week Lunar New Year holiday, even though this is a month away (on February 11th). This saw USD-CNY drop back from the one-week highs that were seen yesterday.

Source: XE news feed
XE Market Analysis: North America – Jan 12, 2021

The dollar fell back, correcting some of the gains that have been seen since it become clear that the Democrats in the U.S. were going to control the Senate, in addition to the Presidency and House. Some narratives attributed this in part to reportedly large demand for China’s yuan, linked to the proximity of the one-week Lunar New Year holiday, even though this is a month away (on February 11th). This saw USD-CNY drop back from the one-week highs that were seen yesterday.

Source: XE news feed
XE Market Analysis: Europe – Jan 12, 2021

Buoyed by general weakening in the US currency and continued strong energy and mineral commodity prices, the Australian dollar has started the year on a bullish note. After finishing 2020 at around US76.2c, the A$ has surged, hitting almost US78.2c last Wednesday, reaching a 33-month high.

Source: Beef Central
Aussie dollar starts 2021 at three-year highs

The Dollar rallied to three-week highs in early N.Y. trade, taking the DXY to 90.72, up from overnight lows of 90.03. The Greenback later pared gains, as Wall Street posted losses, albeit from record closing highs on Friday. USD price action has shifted since the middle of last week, as higher interest rates, and prospects for more stimulus have raised hopes for a much faster economic recovery, once vaccines become widespread. Previously, the USD’s safe-haven status had seen moves negatively correlated to the risk-backdrop.

Source: XE news feed
XE Market Analysis: Asia – Jan 11, 2021

The dollar has put in more rebound distance from the major-trend lows seen against the euro, yen, dollar bloc, and many other currencies a week ago. The U.S. currency has rallied on each trading day since the Georgia runoff elections, when it became clear that the Democrats would control the Senate. This has seen Treasury yields spike and growth expectations rise, given the implication for much greater fiscal spending than would have been the case under a Biden presidency constrained by a split Congress.

Source: XE news feed
XE Market Analysis: North America – Jan 11, 2021

The dollar has continued to rise, putting in more distance from the major-trend lows seen against the euro, yen, dollar bloc, and many other currencies a week ago. The U.S. currency has rallied on each trading day since the Georgia runoff elections, when it became clear that the Democrats would control the Senate. This has seen Treasury yields spike and growth expectations rise, given the implication for much greater fiscal spending than would have been the case under a Biden presidency constrained by a split Congress.

Source: XE news feed
XE Market Analysis: Europe – Jan 11, 2021

The Dollar continued to head higher in Friday afternoon trade, marking its third day of advances. The weaker jobs report took the USD to session lows, with nonfarm payrolls turning negative for the first time since April, though the jump in earnings offset to a degree, allowing the Greenback to recover. Later, the pullback on Wall Street from record highs was likely supportive, with the USD continuing to maintain its safe-haven status.

Source: XE news feed
XE Market Analysis: Asia – Jan 08, 2021

The dollar’s correlative pattern with stock markets has inverted, with the currency now rising in step with rallying global stock markets. The catalyst for the change was the Democrat wins in the Georgia runoff elections, which heralds the prospect of much greater deficit spending and warranting higher growth expectations for the U.S. economy. U.S. Treasury yields have also spiked more than peers, and much more so in the case against JCB and Bunds, which appears to have offset implications for lower real interest rates and real yields from an anticipated higher inflation curve.

Source: XE news feed
XE Market Analysis: North America – Jan 08, 2021

The dollar’s correlative pattern with stock markets has inverted, with the currency now rising in step with rallying global stock markets. The catalyst for the change was the Democrat wins in the Georgia runoff elections, which heralds the prospect of much greater deficit spending and warranting higher growth expectations for the U.S. economy. U.S. Treasury yields have also spiked more than peers, and much more so in the case against JCG and Bunds, which appears to have offset implications for lower real interest rates and real yields from the anticipated higher inflation curve.

Source: XE news feed
XE Market Analysis: Europe – Jan 08, 2021

The Dollar rallied for the second day on Thursday, though the bulk of gains came ahead of the N.Y. open. Higher Treasury yields, and prospects for stronger U.S. growth in the coming months due to what will likely be ramped up spending by Democrats now that they are in charge, have driven the USD up since Wednesday. The DXY printed six-session highs of 89.97 in morning trade, up from early Asian lows of 89.35. Treasuries appear to be raising the red flag on the inflation outlook, while continuation of massive deficit funded stimulus at some point will have the opposite…

Source: XE news feed
XE Market Analysis: Asia – Jan 07, 2021

The dollar has rebounded out of the major-trend lows that were seen yesterday. The DXY dollar index posted a three-day high at 89.95, up from yesterday’s 33-month low at 89.21, while EUR-USD dropped over 0.5% to the mid 1.2200s while USD-JPY rallied to a nine-day high at 103.71. Markets have been discounting the upcoming Biden administration with Democrat control of both the House and Senate. The protests of Trump supporters at Capitol Hill also caused some concern. Together, they have prompted a modest rebound in the dollar.

Source: XE news feed
XE Market Analysis: North America – Jan 07, 2021

The dollar has found a footing after posting fresh losses yesterday, despite risk appetite holding up in Asian markets and into European trading. The DXY dollar index has inched above 89.50 after yesterday posting a 33-month low at 89.21. Markets are digesting the largely unexpected outcome in the two Georgia runnoff elections, which were won by Democrat candidates. Prospects for a Democrat Presidency, House and Senate have greatly increased the prospect for much more fiscal stimulus than there would have been in the scenario of a split House.

Source: XE news feed
XE Market Analysis: Europe – Jan 07, 2021

The Dollar rallied in morning N.Y. trade on Wednesday, despite risk-on conditions. The prospect of further massive fiscal stimulus under a Democrat controlled government boosted Wall Street, and weighed heavily on Treasuries, taking yields sharply higher, and likely providing some support to the USD. Bigger picture, more stimulus and nascent inflation concerns will likely keep the Greenback under pressure in the coming weeks, while prospects for tax hikes and new regulation could weigh on the Dollar as well.

Source: XE news feed
XE Market Analysis: Asia – Jan 06, 2021

The dollar has tumbled to fresh major-trend lows as markets discount a possible Democrat sweep, with one of its Senate candidates, Warnock, having been declared winner in one of the two Georgia runoff elections, and the other, Ossoff, showing a slim lead in the vote count so far in the other election. Democrats need to win both to level the Senate at 50-50. Control would then swing to the Democrats due to the tiebreaker vote of Vice President-elect Kamala Harris.

Source: XE news feed
XE Market Analysis: North America – Jan 06, 2021

The dollar has tumbled to fresh major-trend lows as markets discount a possible Democrat sweep, with one of its Senate candidates, Warnock, having been declared winner in one of the two Georgia runoff elections, and the other, Ossoff, showing a slim lead in the vote count so far in the other election. Democrats need to win both to level the Senate at 50-50. Control would then swing to the Democrats due to the tiebreaker vote of Vice President-elect Kamala Harris.

Source: XE news feed
XE Market Analysis: Europe – Jan 06, 2021

The Dollar came under modest pressure in N.Y. on Tuesday, with the safe-haven currency weighed down by a moderate risk-on backdrop. Wall Street headed higher, despite the uncertainty of Tuesday’s Georgia Senate runoff elections. A better than expected December manufacturing ISM helped the USD briefly, and aided stocks as well, though the sharply higher ISM prices paid component weighed on Treasuries, resulting in a bump up in yields as inflation concerns begin to take shape.

Source: XE news feed
XE Market Analysis: Asia – Jan 05, 2021

The dollar has been trading steadily so far today after yesterday rebounding quite sharply from 33-month lows. This has come amid a backdrop of sputtering stock markets, with narratives ascribing today’s two runoff elections in Georgia, which has existential implications for the incoming Biden administration (as the result will decide whether Democrats or Republicans will control the Senate), alongside the constant rise in positive Covid tests and associated restrictions, as providing excuse for markets to correct.

Source: XE news feed
XE Market Analysis: North America – Jan 05, 2021

The dollar has been trading steadily so far today after yesterday rebounding quite sharply from 33-month lows. This has come amid a backdrop of sputtering stock markets, with narratives ascribing today’s two runoff elections in Georgia, which has existential implications for the incoming Biden administration (as the result will decide whether Democrats or Republicans will control the Senate), alongside the constant rise in positive Covid tests and associated restrictions, as providing excuse for markets to correct.

Source: XE news feed
XE Market Analysis: Europe – Jan 05, 2021

The Dollar headed modestly higher in N.Y. on Monday, seeing the DXY recover from fresh 33-month lows of 89.42 to a high of 89.92. A sharp bout of risk-off supported the USD, as Wall Street started the year with sharp losses, driven by profit taking from record highs, spiking Covid cases, and angst ahead of Tuesday’s Senate run-off elections in Georgia. Data was light, though saw a bounce in the December Markit manufacturing PMI, and a solid November construction spending report, which were mildly supportive of the Greenback as well.[EUR, USD]

Source: XE news feed
XE Market Analysis: Asia – Jan 04, 2021

The dollar has started the new year where it left off last year, and that is with a softening bias. This comes against the backdrop of a coursing “everything rally”, with the MSCI Asia-Pacific equity indexand S&P 500 futures hitting record highs. Base metals and oil prices also rallied. The dollar itself is correlating inversely with this theme, with U.S.

Source: XE news feed
XE Market Analysis: North America – Jan 04, 2021

The dollar has started the new year with a declining bias, which is of course where it left off last year. This comes against the backdrop of a coursing “everything rally”, with the MSCI Asia-Pacific equity indexand S&P 500 futures hitting record highs. Base metals and oil prices also rallied, and the main crypto currencies hit fresh record levels. The dollar itself is correlating inversely with this theme, with U.S.

Source: XE news feed
XE Market Analysis: Europe – Jan 04, 2021

N.Y. FX trade was very quiet on the last day of the year, though the Dollar managed modest gains through the morning session. The DXY has made new trend lows of 89.52 in overnight Asian trade, though managed to rebound to 89.94 highs into the London close. The weekly jobless claims data likely helped USD sentiment to a degree, with both initial and continuing claims printing lower than expected outcomes. Wall Street traded either side of flat, while Treasury yields were little changed.[EUR, USD]

Source: XE news feed
XE Market Analysis: Asia – Dec 31, 2020

The DXY dollar index has posted another major-trend low, at 89.52, a level last traded in April 2018. The dollar has continued to correlate inversely with global stock market direction, with weakness today being concomitant with the MSCI Asia Pacific rising to a new record high in holiday-thinned conditions. The DJIA yesterday closed at a fresh record on Wall Street. European markets declined, however, while oil and other commodities have remained directionally subdued. EUR-USD remained buoyant on dollar weakness, although remained just off from yesterday’s near-33-month peak.

Source: XE news feed
XE Market Analysis: North America – Dec 31, 2020

The Dollar was lower in N.Y. on Wednesday, seeing the DXY hit new 33-month lows of 89.56 early in the session, down from 90.02 after the close on Tuesday. The greenback later recovered modestly in light afternoon trade. Prospects for further fiscal stimulus weighed on the USD, while softer incoming data didn’t help either. The advance goods trade deficit for November ran up to its highest ever, while pending home sales fell short of expectations as well. The Chicago PMI was better than expected, which offset to a degree.

Source: XE news feed
XE Market Analysis: Asia – Dec 30, 2020

The DXY dollar index posted a new 32-month low at 89.68, while EUR-USD concurrently printed a 32-month high at 1.2295. USD-JPY saw a nine-day low, at 103.12. The pair’s near-10-month low, seen on December 17th, is at 102.88. The Australian and New Zealand dollars posted respective 30- and 32-month highs against their U.S. peer. AUD-JPY and NZD-JPY also saw new trend highs. The Canadian dollar also traded firmer, but remains comfortably below recent trend highs. Oil prices remain in a consolidation, below recent near-nine-month highs. Base metal prices also remain off recent trend highs.

Source: XE news feed
XE Market Analysis: North America – Dec 30, 2020

The Dollar was lower in N.Y. on Tuesday, weighed down by the signing of the stimulus bill, and prospects for direct payments to individuals to rise to $2,000 from $600. The U.S. House voted to increase the amount of payments, while the Senate is expected to vote on the measure at some point on Tuesday or Wednesday. The DXY fell from overnight highs of 90.22, later bottoming at 89.86, before reclaiming the 90.00 handle. There was no top tier data to move markets. Wall Street opened on a stronger footing, though gave back gains through the session.

Source: XE news feed
XE Market Analysis: Asia – Dec 29, 2020