USD underperforms, risk-on market sentiment
September 5, 2019
Risk-on sentiment extends into today’s trading session as risks of a no-deal Brexit ease, confidence regarding US-China trade talks resumes and Riksbank surprises markets by maintaining interest rates and less dovish stance.
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September 5, 2019
EUR/USD 1.1076 GBP/USD 1.2340 USD/CAD 1.3200 AUD/USD 0.6824 USD/JPY 106.90 USD/CNH 7.1420 USD/ILS 3.5140 USD/MXN 19.6500 USD/CHF 0.9833 USD/INR 71.8450
US dollar traded weaker ahead of ADP Private Payrolls Data and remained largely unchanged after the release showed that US companies added the most jobs in four months. US Employment data is due to release tomorrow at 8:30am EST.GBP
The British pound is currently trading above $1.23, strengthening almost 3% since the beginning of this week. Sterling experienced its latest boost following the UK Parliament’s vote to reject Prime Minister Boris Johnson’s call for a general election. Johnson speaks today and will try to appeal directly to voters to win support for an election.EUR
The euro heads for its third day of gains against the USD trading above 1.10. Speculation that the ECB will be less dovish than initially anticipated earlier this week extends after the latest central bank decisions (RBA, BoC, Riksbank) have all been to keep interest rates on hold.CAD
USD/CAD hit three-week lows at 1.3192 early in the trading session. The loonie strengthened further following yesterday’s BoC meeting where the Central Bank kept its key interest rate at 1.75%. Risk-on trading and higher oil prices continue to support the Canadian dollar. The 50-day moving average of 1.3188 is the next level of support.ASIA/PACIFIC
The Japanese Yen continues to weaken as demand for safe-haven assets wanes.
AUD up nearly 0.5%, as upbeat commodity markets support the currency.Argentine Peso
On Sunday, Argentina announced capital controls implementing rules for exporters to repatriate foreign funds within five days of payment and that corporates must be granted permission by the central bank prior to purchasing US dollars in the FX market. Companies must also request permission to distribute dividends internationally. ARS has gained almost 9% lower since the announcement.
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