Greenback rallies on weak Asian and European stock markets
The Bloomberg Dollar Index hit its highest level in five weeks as Asian and European equities dropped - fueled by disappointing earnings from US tech corporates. The expectation of further delays of Covid-19 vaccine distribution has supported the move lower for equities. In the eurozone, the European Union has failed to resolve its dispute with AstraZeneca, increasing the risk of delays for vaccines.
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January 28, 2021
EUR/USD 1.2130 GBP/USD 1.3705 USD/CAD 1.2815 AUD/USD 0.7648 USD/JPY 104.32 USD/CNH 6.4768 USD/ILS 3.2900 USD/MXN 20.3597 USD/CHF 0.8887 USD/INR 73.0425
The US dollar strengthened by the most in a month yesterday following overnight risk-off sentiment fueled by weaker than expected tech company earnings and disappointing vaccine distribution news. Yesterday's Fed statement that it intends to maintain a dovish stance had little impact. The greenback rallied as much as 0.8% versus G10 peer currencies.GBPSterling fell as much as 0.4% to $1.3630 after falling 0.4% in the previous day's trading session. The added pressure overnight stems from broad USD strength.EUR
The EUR is under downward pressure after hitting multi-year highs at the end of 2020 and as investors react to disappointing vaccine news. Despite the weaker EUR, the EUR/USD currency pair held above January lows.CAD
The loonie dropped to lowest levels in more than a month following the decline in oil prices and equities. USD/CAD rose as much as 0.7% hitting a high of 1.2881.ASIA/PACIFIC
The Japanese yen fell to lowest level in over two weeks as the US dollar became the preferred safe haven currency amidst a sell-off in equities. USD/JPY hit 104.37, the highest level since Jan 11.
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