Risk-off trading supports the US dollar
Concerns regarding Afghanistan and the continued spread of Covid attributed to risk-off trading. The safe haven Swiss franc was the strongest G10 currency while the Australian dollar dropped to a nine-month low.
August 17, 2021
EUR/USD 1.1736 GBP/USD 1.3758 USD/CAD 1.2618 AUD/USD 0.7270 USD/JPY 109.5000 USD/CNH 6.4921 USD/ILS 3.2306 USD/MXN 19.9666 USD/CHF 0.9121 USD/INR 74.3488 USD/BRL 5.2811 USD/SGD 1.3613 USD/DKK 6.3378 USD/SEK 8.6953 USD/NOK 8.8678
The Bloomberg stock index advanced 0.2% following yesterday’s gain of 0.1%. Investors are focused on Jerome Powell’s town hall today, following comments from the Fed’s Eric Rosengren who stated that he expects to see enough US Job growth to warrant bond tapering at the central bank’s meeting next month.GBPData earlier today showed that unemployment fell to 4.7% - the lowest since the summer of 2020. Sterling weakened to lowest levels in three weeks as investors are concerned that the labor market could cool down as government support is withdrawn.EUREUR/USD remains within the 1.17 trading handle. The currency pair is under pressure amidst the broader risk-off trading sentiment.CADUSD/CAD is trading higher as the US dollar remains supported by risk adverse trading. The currency pair hit a one-month high of 1.2630 with flight to safety trades and weak oil prices.ASIA/PACIFICThe New Zealand kiwi declined as much as 1.6% as traders are uncertain if the central bank will proceed with the highly anticipated and expected rate hike at Wednesday’s meeting. The country is having a three-day lockdown following the first community case of the Corona virus since February.
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