Powell disappoints, upbeat US jobs data, dollar higher
Fed Chair Powell’s vow to keep an easy monetary policy disappointed markets, triggering another round of bond selling. This led to higher yields around the world - the US Treasury 10-Yr yield hit 1.61%. This morning’s upbeat US jobs data helped fuel the bond sell-off, but led to a higher open in US stocks and a stronger US dollar index. The surprise decision by OPEC+ to keep oil production limits steady led to a surge in oil prices, WTI is currently trading at $65, up $4 a barrel.
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March 5, 2021
EUR/USD 1.1913 GBP/USD 1.3813 USD/CAD 1.2661 AUD/USD 0.7684 USD/JPY 108.26 USD/CNH 6.4979 USD/ILS 3.3267 USD/MXN 21.2364 USD/CHF 0.9302 USD/INR 73.0275 USD/BRL 5.6839 USD/SGD 1.3412 USD/DKK 6.2421 USD/SEK 8.5483 USD/NOK 8.5590
The US dollar is opening higher following the upbeat US jobs data. Traders are also buying the dollar as safe haven protection from market uncertainty related to the global bond sell-off, and equity and commodity market volatility. The dollar gained against all currencies except the oil-related currencies -- the Norwegian krone, Russian ruble and Canadian dollar -- following the OPEC+ decision to hold production levels steady.GBP
The UK pound dropped 0.5% and to its lowest level in two weeks, in-line with the rally in the dollar. The FTSE equity market is higher today, one of the only global equity markets to rally.EUR
The euro dropped briefly below $1.19, its lowest level since late November, as traders rush to the safety of the dollar. Traders await key economic data releases next week – employment, GDP, Industrial Production, as well as the European Central Bank meeting on Thursday – the ECB’s -0.50 benchmark rate is expected to remain unchanged.CAD
The CAD whipsawed in a wide range following news that OPEC+ decided to maintain its oil production limits for member nations. The USD/CAD is currently trading near yesterday’s close at C$1.2665. Traders await the Bank of Canada meeting next Wednesday, when the BOC’s 0.25% benchmark rate is expected to be unchanged.ASIA/PACIFIC
The Australian dollar was the worst performing currency overnight, dropping to its lowest level in nearly a month. The AUD was negatively impacted by news that China had set its GDP growth target above 6% for the year, below what most analysts had expected, which drove iron ore prices lower.
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