FXTM information and reviews
FXTM
93%
OctaFX information and reviews
OctaFX
92%
XM information and reviews
XM
91%
FXCC information and reviews
FXCC
90%
Libertex information and reviews
Libertex
89%
FxPro information and reviews
FxPro
88%

Dollar and Yen see mild weakness


25 August 2020

Most USD pairings have remained well within their ranges from yesterday, though the US Dollar and Yen saw mild weakness against most other currencies, outside the cases against the New Zealand and Canadian Dollars.

Wall Street clocked fresh record highs for the USA500 and USA100 yesterday. PE ratios are stretched, but trend following, index tracking and the float of massive global stimulus are driving shares higher, creating a reality gap with fundamental value. Some good news came from the US and China on the Phase 1 trade deal, too, with China’s commerce ministry reporting “constructive dialogue” after the US Treasury stated that “both sides see progress.” Spirits have also been lifted by developments of COVID-19 treatments and vaccinations.

Against this backdrop, EURUSD has been plying overall a narrow range near 1.1800, but it is moderately up on Monday’s New York closing level, despite German Q2 GDP revised slightly higher and German Ifo index better than expected as current conditions improve. USDJPY whittled out a 4-day high at 106.35, reflective of mild Yen underperformance amid the risk-on environment. Cable lifted slightly, reaching a 1.3116 intraday high before settling back below 1.3100, remaining comfortably within the range seen yesterday. Ditto for AUDUSD, with pair modestly up on the day, while NZDUSD bucked the trend in ebbing to a 5-day low at 0.6515. Lockdown measures and a new record lows in NZ 10-year bond yield have been weighing on the Kiwi dollar.

The Canadian dollar has also been on an softening streak, with USDCAD posting a 5-day peak at 1.3240. USOIL prices have settled, having not sustained gains seen yesterday, despite concerns of disruption to oil production facilities and distribution in the Gulf of Mexico as hurricanes bear down. Crude market narratives have highlighted analyst concerns about flagging demand due to ongoing lockdown measures around the world.

In the bigger view, USDCAD has been trending lower, albeit with waning momentum, since mid March. The global economic recovery from lockdowns, which were at their zenith in April, has been instrumental in driving this downtrend, while the US currency waned as a safe haven unit before negative real US yields subsequently become a dominant factor in fuelling the greenback’s downtrend. Upside risks for USDCAD include the OPEC+ group’s course to easing output quotas, which could weigh on oil prices depending how it matches with the evolution in demand, alongside the coronavirus pandemic and geopolitical tensions, should they derail the recovery in global asset markets. With the US economy recouping and Treasury yields perking up, the US dollar may also be set for a rebound after a prolonged phase of weakening.

#source

Share:


Related

USD/JPY sticks to its consolidative theme
USD/JPY sticks to its consolidative theme

USD/JPY remains side-lined for the time being, note FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang. Yesterday, we highlighted that ‘upward momentum has slowed and USD is unlikely...

5 Aug 2022

USD/JPY pares intraday losses to multi-week low
USD/JPY pares intraday losses to multi-week low

USD/JPY stages a goodish bounce from a multi-week low touched earlier this Friday. Recovering US bond yields help revive the USD demand and offers support to the pair...

29 Jul 2022

The Yen updated the lows
The Yen updated the lows

USDJPY reached new highs – the “greenback” continues to get stronger. The Japanese Yen plunged against the USD. The current quote for the instrument is 137.02. A new high for the pair is at 137.28....

11 Jul 2022

The Yen may drop
The Yen may drop

USDJPY is preparing a new attack on the highs. The Japanese Yen is slowly falling against the USD. The current quote for the instrument is 136.16. The statistics published...

8 Jul 2022

200-hour SMA, around 135.60 might continue to cap the upside
200-hour SMA, around 135.60 might continue to cap the upside

USD/JPY recovered a few pips from the daily low, though lacked any follow-through buying. Ascending trend-line breakdown and failure near the 200-hour SMA favours bearish traders...

4 Jul 2022

The Yen hit new lows
The Yen hit new lows

USDJPY updated its 24-year highs and may continue rising. The Japanese Yen hit a new 24-year low against the USD. The current quote for the instrument is 136.25. The high in USDJPY...

22 Jun 2022


HFM information and reviews
HFM
87%
IronFX information and reviews
IronFX
86%
FXCM information and reviews
FXCM
85%
Pepperstone information and reviews
Pepperstone
84%
NordFX information and reviews
NordFX
83%
LegacyFX information and reviews
LegacyFX
82%

© 2006-2022 Forex-Ratings.com

The usage of this website constitutes acceptance of the following legal information.
Any contracts of financial instruments offered to conclude bear high risks and may result in the full loss of the deposited funds. Prior to making transactions one should get acquainted with the risks to which they relate. All the information featured on the website (reviews, brokers' news, comments, analysis, quotes, forecasts or other information materials provided by Forex Ratings, as well as information provided by the partners), including graphical information about the forex companies, brokers and dealing desks, is intended solely for informational purposes, is not a means of advertising them, and doesn't imply direct instructions for investing. Forex Ratings shall not be liable for any loss, including unlimited loss of funds, which may arise directly or indirectly from the usage of this information. The editorial staff of the website does not bear any responsibility whatsoever for the content of the comments or reviews made by the site users about the forex companies. The entire responsibility for the contents rests with the commentators. Reprint of the materials is available only with the permission of the editorial staff.
We use cookies to improve your experience and to make your stay with us more comfortable. By using Forex-Ratings.com website you agree to the cookies policy.