Forex Today: US dollar keeps shining as investors shun risk amid coronavirus, economic woes
- 24th September 2020
- Posted by: Hakeem
- Category: FOREX LATEST NEWS DAILY
Here is what you need to know on Thursday, September 24:
The US dollar kept pushing higher, as investors preferred the safety bet to riskier assets amid downbeat market mood. Markit’s dismal Preliminary business activity data on both sides of the Atlantic underscored growing risks of the coronavirus resurgence on the nascent global economic recovery.
Skepticism over additional US monetary and fiscal stimulus also weighed on the investors’ sentiment. Asian stocks followed Wall Street lower while the US stock futures resumed the decline after a brief pullback.
Risk-aversion fed dollar’s demand rattled the Antipodeans, with AUD/USD the main laggard amongst the G10 currencies The aussie was dumped to fresh two-month lows below 0.7050 amid narrowing AU-US 10-year yield spread, in light of increased calls for the Reserve Bank of Australia (RBA) rate cut as early as the next month. The kiwi also lost ground and headed towards 0.6500.
The sell-off in the commodities-complex also collaborated with the declines in the Antipodeans. Gold slipped to the lowest in six weeks just above $1850 while WTI almost tested the $39 mark on mounting demand concerns.
EUR/USD refreshed two-month lows at 1.1645 due to fears of intensifying virus spread in the Old Continent, as the number of cases tops 5 million. The euro area economic recovery hopes faltered with mixed PMI reports and deteriorating confidence. The focus, therefore, remains on the German IFO survey.
GBP/USD battled 1.2700, having retreated from a temporary bounce from two-month lows to near 1.2775 region. EU’s Barnier said he is determined to reach a post-Brexit transition trade deal with the UK. Virus risks and slower expansion in the Kingdom’s business activity undermined the sentiment around the pound. The UK reported 6,178 new infections, the biggest daily jump since May.
Cryptocurrencies’ licked wounds, with Bitcoin attempting a recovery around $10,300.