The Indian rupee fell for a fourth consecutive session on Thursday, logging its worst day against the dollar in two months, pressured by a decline in regional currencies and an uptick in crude prices amid intensifying Middle East conflict. The rupee ended at 83.9675 against the U.S. dollar, down from 83.82 in the previous session. The domestic currency fell to an intraday low of 83.97 during the session, just shy of its record low of 83.9850, hit last month. “While the 84 level is expected to act as a strong ...

Bullish bets on the Chinese yuan strengthened after a bazooka of stimulus measures led to global investors reallocating funds to Asia’s largest economy, while long positions in most other emerging Asian currencies were largely steady, a Reuters poll showed on Thursday. Long positions on the Chinese currency CNY=CFXS hit their highest since late January 2023, with analysts maintaining their bullish streak on the yuan for a fifth consecutive iteration of the fortnightly poll. Investors started rushing into China’s previously beaten-down financial markets after the country announced a slew of initiatives, ...

The dollar scaled a more than six-week high versus the yen on Thursday as robustness in the U.S. jobs market reinforced bets the Federal Reserve will not rush to cut interest rates. Sterling tumbled to a two-week trough after Bank of England Governor Andrew Bailey said in an interview with the Guardian newspaper that the central bank could become “a bit more activist” on rate cuts if there was further good news on inflation. The euro slid to a three-week trough after normally hawkish European Central Bank policymaker Isabel Schnabel ...

USD: On solid ground Investors remain on high alert about the volatile Middle East situation. Brent crude prices are stabilising around $75/bbl while awaiting Israel’s retaliation against Iran. It has been reported that the US is attempting to deter strikes on Iranian nuclear plants, which could be seen as a further escalation by Israel. The most noticeable effect for FX has been a stronger dollar, although yesterday’s price action seemed to default back to trading the US macro story. The stronger-than-expected ADP employment figures sent the USD 2-year swap rate ...

The U.S. dollar will hold steady in coming months despite an expected series of Federal Reserve interest rate cuts, according to median forecasts from FX strategists polled by Reuters who were, however, largely split on the currency’s broad direction. Since July the greenback (.DXY), opens new tab has lost almost all the near-5% gains against a basket of major currencies accumulated through mid-year on expectations the Fed would reduce its funds rate (USFOMC=ECI), opens new tab from what many considered an overly-restrictive level. However, the currency has been mostly stable ...

The dollar held onto itssharpest gains in a week on Wednesday after an Iranian missile attack on Israel drove buying of safe assets as investors fretted about the widening of conflict in the Middle East. Moves in Asia wereslight, though most currencies were attempting to regain some ground after sharp falls in the previous session. The euro EUR=EBS eased 0.06% to $1.1060,following its largest drop in nearly four months on Tuesday. The Australian AUD=D3 and New Zealand NZD=D3 dollars erased early gains to last trade 0.06% and 0.25% higher, respectively, ...

Safe haven currencies the Japanese yen and Swiss franc gained on Tuesday after news reports that Iran is preparing to imminently launch a ballistic missile attack against Israel, while U.S. jobs data showed a resilient labor market. A senior White House official said on Tuesday that the United States is actively supporting preparations to defend Israel. “The market has largely ignored the Middle East conflict in the last month, but a direct Iran-Israel confrontation is always at risk of spiraling,” said Adam Button, chief currency analyst at ForexLive in Toronto. ...

USD: Powell pushes back against 50bp hike It’s been a hectic start to the week in central bank news and geopolitics: Fed Chair Jerome Powell explicitly pushed back against a 50bp rate cut by year-end, and Israel started a ground offensive in Lebanon. In other conditions, the dollar would have rallied on such a combination of events, but sensitivity to Fedspeak and Middle East turmoil has been reduced. On the Fed side, the 50bp reduction in September means that market pricing is more structurally dovish-leaning, perhaps also on the premises ...

The South African rand slipped on Monday as it took a breather after two weeks of gains following an improvement in investor sentiment towards the currency. At 1527 GMT, the rand traded at 17.25 against the dollar , about 0.8% weaker than its closing level on Friday. An 50 basis point interest rate cut by the Federal Reserve earlier this month, followed by a 25 basis point cut by the South African Reserve Bank (SARB) helped the rand hit repeated 20-month highs against the greenback last week. Improving domestic economic ...

USD: Downside risks from data this week China’s steps to support the housing and stock market have led to a rush to buy Chinese stocks this morning, ahead of the National Day 1-7 October holiday. The CSI index is up 7%, the Hang Seng 3% – and that is translating into stronger China-proxy Aussie and Kiwi dollars, along with a generally soft USD as safe-haven demand wanes. Another big development in Asia has been the surprise victory of Shigeru Ishiba in the Liberal Democratic Party primaries. The Nikkei is trading ...

It’s safe to say that the timing and scale of the stimulus measures unleashed by China this week were, in large part, prompted by the U.S. Federal Reserve’s jumbo-sized interest rate cut only a few days before. But unfortunately for Chinese policymakers, the U.S. central bank’s apparent commitment to an aggressive easing campaign – and the impact this could have on the exchange rate between the yuan and the dollar – could put Beijing in a serious bind. On the face of it, the yuan’s substantial appreciation against the dollar ...

South Africa’s rand extended gains against the dollar on Friday, hitting a fresh 20-month high amid improved risk appetite and positive sentiment at home. At 1400 GMT, the rand traded at 17.125 against the greenback , 0.35% firmer than its previous close. It earlier hit 17.075 per dollar, its strongest level since early February 2023. The dollar index was last down 0.31% against a basket of currencies after a reading of U.S. inflation indicated price pressures continue to cool. The rand has been on an upward trajectory since a big ...

USD: Core PCE should not rock the market US initial jobless claims came in once again lower than expected (218k versus 223k) yesterday, but continuing claims – which track the speed to re-enter the jobs market – rebounded to 1.834m. Durable goods orders were stronger than expected and the expected revision lower in 2Q GDP from 3.0% to 2.9% didn’t materialise. Market pricing for year-end Fed rates inched higher by a few basis points over the past couple of sessions, but the dollar was offered again yesterday after some positioning ...

The dollar was down in choppy trading on Thursday after a host of U.S. data indicated a relatively healthy economy, while the Swiss franc rose after the country’s central bank cut interest rates by 25 basis points (bps). The greenback began paring losses after data showed U.S. weekly jobless claims fell by 4,000 to a four-month low of 218,000, below the 225,000 forecast by economists polled by Reuters. In addition, other reports showed corporate profits increased at a more robust pace than initially thought in the second quarter while gross ...

USD: Focus on jobless claims The dollar rallied across the board yesterday as quarter-end flows probably favoured a broad positioning adjustment. Based on the latest CFTC figures, we calculate that the dollar was in net-short territory against the other reported G10 currencies on 17 September, but that amounted to a relatively small 4% of open interest. The yen was, however, one of the largest speculative longs (+29% of open interest), and it is not surprising to see some squeezing in the pair around the turn of the quarter. Incidentally, the ...