16 September, 2013
Monday trading began with a sharp fall in the U.S. dollar as markets reacted to the big story that Lawrence Summers has withdrawn from the race for the role of the next Federal Reserve Chairman to replace Ben Bernanke.
Market was warming itself up to the appointment of Summers which is why recently we have seen the dollar strengthening. Summers was expected to begin tapering and tightening.
Janet Yellen is now seen to be the front runner and is seen as being very dovish and more in favour of loose monetary policy and is expected to continue with the Fed’s current stimulus program. Currently the Fed busy $85 billion worth of bonds a month to prop of the U.S. economy. Such a measure tends to weaken the dollar.
The dollar fell across the board just as Asian currency markets opened for trading on Monday, with most currency pairs opening with a huge gap from Friday’s close.
USDJPY moved lower and opened at 98.68 versus Friday’s close of 99.35 yen while EURUSD moved higher, opening over 50 pips higher at $1.3357 compared to Friday’s close of $1.3296.
AUDUSD spiked up to a session high of $0.9391 versus Friday’s close of $0.9247 before steadying at $0.9324.
The Asian session was calm as the economic calendar was light and most investors were positioning ahead of key risk events later this week, primarily the US nonfarm payrolls report on Friday...
The first full trading week of 2014 began today, with Japan opening for the first time after a two-week holiday...
The pair extended the positive trading, whereas it approached 61.8% correction at 1.3625
The dollar rose above 102.00 yen for the first time since May 29, while the euro flirted with the key $1.36 handle and hit a new four-year high within striking distance of 139.00 yen...
The best performing currency during Thursday’s Asian session was the Australian dollar which jumped against its US counterpart after strong Australian business spending data. Private Capital Expenditure increased by 3.6% quarter-on-quarter despite expectations for a decline by 1.1%...
The main currency of the day was the sterling which outperformed against the dollar and euro, as well as against the yen after being boosted by strong UK second quarter growth data...
The euro was stronger today particularly against the dollar and the pound. While there were no economic data releases today from the Eurozone to explain the move, there were some headline news which affected sterling and dollar...
The yen was supported by safe haven demand today after the release of a slightly dovish Bank of Japan policy meeting minutes. The minute from last weeks meeting showed some concern about Japans economic outlook and whether the central bank 2% inflation target could be met...
The dollar remains bullish against the yen, while the euro hit a new four-year high against the Japanese currency in todays Asian session...