Dollar falls further, ending nearly flat on the year
The US dollar fell for the seventh straight day, reaching its lowest level since June. The dollar index will end the year nearly flat. Trading was light with many financial centers closed for the New Year. Impeachment concerns made some headlines, but basically it was investors taking profits on long dollar positions that fueled the dollar's weakness. Equity markets are off slightly and bonds unchanged. Gold jumped to over $1520 per ounce, its highest level since September.
December 31, 2019
EUR/USD 1.1222 GBP/USD 1.3211 USD/CAD 1.2998 AUD/USD 0.7022 USD/JPY 108.64 USD/CNH 6.9654 USD/ILS 3.4576 USD/MXN 18.8587 USD/CHF 0.9665 USD/INR 71.3788
The dollar index is closing the year on a weak note. For the year, it barely changed. There was little information for traders to digest, and most dollar selling was simply profit-taking on long dollar positions.GBP
The best performing currency overnight was the UK pound, gaining nearly 0.75% as it traded back up to $1.32. Although much of its recovery was due to broad dollar weakness, there was also a sense of relief that Britain is heading into the new year free from the risk of a messy Brexit.EUR
The euro strengthened again, its seventh straight day of gains. News out of Europe was light. The yield on the German 10-yr bund rallied to -0.19%, its highest level since May 2019, and well off August’s lows at -0.72%.CAD
In very thin trading, the Canadian dollar rallied to C$1.30, its strongest level since October 2018. It will end the year the strongest of the G10 currencies, poised to gain nearly 5%.ASIA/PACIFIC
Japanese markets were on holiday.
The Chinese yuan gained on the dollar, and is approaching 6.95, its strongest level since August. China’s December PMI figure was unchanged.