Strong US economic data could not save dollar as selling pressure picks up speed vs CAD, GBP and EUR
Despite caution this morning in equity and bond markets, the US dollar remains under pressure as does fellow safe haven currencies – the Swiss franc and Japanese yen. The US 10-yr Treasury yield again set a one-year high of 1.45% up from 1.08% to start the month. The higher yield is bringing in global investors who believe the increase is not a prelude to higher inflation. By comparison, the euro denominated German 10-yr bond has a negative yield and the British bond yields 0.81%.
“Courage is grace under pressure.”
February 25, 2021
EUR/USD 1.2220 GBP/USD 1.4161 USD/CAD 1.2482 AUD/USD 0.7976 USD/JPY 106.12 USD/CNH 6.4566 USD/ILS 3.2767 USD/MXN 20.6550 USD/CHF 0.9053 USD/INR 72.4250 USD/BRL 5.4452 USD/SGD 1.3192 USD/DKK 6.0836 USD/SEK 8.2424 USD/NOK 8.3722
Strong Durable Goods for January as well as better than expected weekly initial jobless claims could not rescue the declining dollar especially vs. the euro, pound and Canadian dollar. Financial markets will continue to watch stimulus talks in Congress and gauge the impact on the 10-yr Treasury bond.GBP
The British pound heads toward a 6th consecutive day of gains vs. the US dollar on optimism the UK will successfully vaccinate enough citizens to stick to a June date to remove all lockdown restrictions and fully reopen the economy.EUR
Mixed economic data from the eurozone could not stop the common currency from gaining vs. the US dollar. FX market watchers’ site technical trading levels around 1.218, suggesting once the level is given the euro will rise to 1.2348.CAD
The Canadian dollar hit its strongest level vs. USD in over 3 years on the strength of gains in oil prices. An OPEC meeting next week will be watched carefully regarding possible changes in oil production, especially from Russia and Saudi Arabia, with any announcement of a large increase in production likely to sink the price of oil.ASIA/PACIFIC
The Australian dollar hit a 3-year high vs. the US dollar as the commodity-linked rally continues.
The Japanese yen was weaker again today as the 10-yr US Treasury bond yield hit 1-year highs, attracting investment from Asian investors who buy dollars to buy the Treasuries.
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