Dollar lower as foreign equities climb
Foreign equities climbed in-line with US equities as the risk-on mood continues into year-end. The dollar is lower across the board, particularly against the euro and UK pound. China saw a pick-up in industrial profits. In Europe, a gauge of confidence in investment-grade debt hit its highest level since 2007.
December 27, 2019
EUR/USD 1.1153 GBP/USD 1.3090 USD/CAD 1.3084 AUD/USD 0.6972 USD/JPY 109.5300 USD/CNH 6.9930 USD/ILS 3.4612 USD/MXN 18.9200 USD/CHF 0.9759 USD/INR 71.3550
The dollar declined across the board, as the risk-on mood continues to benefit foreign currencies. The dollar is not benefiting from news of Alaska’s Republican senator signaling uncertainty and four other Republicans seen as possible votes to impeach. Trump’s re-election is taken as bullish news for the financial markets, his impeachment as bearish news.GBP
A rise in the UK pound is helped by new European Commission President Ursula von der Leyen saying that the EU may need to extend the 2020 year-end deadline to conclude talks about a new trade relationship with the UK.EUR
The euro gained in thin liquidity markets as large speculators covered short positions. Economic data and geopolitical announcements were light as we head into year-end.CAD
The Canadian dollar rallied to its highest level since October amid overall weakness in the US dollar. Canadian 2-year yields continue to exceed US yields. Oil prices edged higher.ASIA/PACIFIC
The Chinese yuan and Japanese yen held steady. The month-long positive trend for Asian emerging market currencies remains intact.