Russia-Ukraine tensions and impending Fed meetings drive the markets for the second straight day. The dollar continues its advance as haven of choice as equities continue to struggle. Global leaders rush to defuse tensions at the Ukraine border. US markets await the conclusion of the two-day Fed meeting tomorrow to greater understand the path and pace of Federal Reserve tightening.
"The pessimist complains about the wind. The optimist expects it to change. The leader adjusts the sails.”
January 25, 2022
EUR/USD 1.127 GBP/USD 1.3469 USD/CAD 1.2634 AUD/USD 0.7134 USD/JPY 113.88 USD/CNH 6.3376 USD/ILS 3.1838 USD/MXN 20.6750 USD/CHF 0.9183 USD/INR 74.7775 USD/BRL 5.4924 USD/SGD 1.3447 USD/DKK 6.6047 USD/SEK 9.3042 USD/NOK 8.9975
The dollar is higher versus G-10 peers rising 0.30%. Diplomatic efforts around Russia and Ukraine continue, as the US readies 8,500 troops in case efforts to defuse fail.
FOMC’s two-day meeting begins today and markets will hurry to digest the post-decision press conference scheduled for tomorrow for any information on the pace of hikes. Specifically, markets are listening for rate increases in addition to the three projected by FOMC members at the last meeting in December.GBP
The pound remains under pressure as haven currencies attract buying interest amid a risk off mode.EUR
The euro added to last week's losses and the common currency is now at one-month lows. EUR1.3B of strikes are set to roll off today as long positions are trimmed and short term yield differentials widen. French and German leaders head to Berlin later today to discuss the Russia/Ukraine situation.CAD
Canadian dollar also slumps compared to the US counterpart as traders place bets ahead of tomorrow’s BOC meeting.ASIA/PACIFIC
USD/JPY climbs higher as the greenback wins haven interest.
The Chinese yuan gained vs. USD as PBOC set a daily reference rate at 6.3418. CNH is trading close to its strongest levels since 2018 as the weeks just before Golden Week are traditionally a strong period for the renminbi.
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