The dollar’s strong performance since the start of the week has largely stemmed from negative political developments weighing on the euro and yen. These two currencies make up 71% of the DXY index, which is now at its highest since early August, ING's FX analyst Francesco Pesole notes.
The stock market is ironically benefiting from the US government shutdown as the delay in key US data releases keeps the Fed on track to cut rates further
Euro (EUR) fell further amid fresh political uncertainties. EUR/USD was last at 1.1619 levels, OCBC's FX analysts Frances Cheung and Christopher Wong note.
EUR/HUF has staged a strong rebound after touching the lower end of its multi-month range near 386. The pair is now testing the 50-day moving average, a key resistance that has limited gains since June, Société Générale's FX analysts note.
Japanese Yen (JPY) has come off by about 3%, post-LDP vote over weekend. USD/JPY was last at 152.78 levels, OCBC's FX analysts Frances Cheung and Christopher Wong note.
AUD/NZD has extended its rally beyond the September highs, signaling renewed bullish momentum. The pair is approaching the 1.1490/1.1520 zone near the 2022 peak, where upside momentum may begin to fade.
New Zealand Dollar (NZD) fell sharply after RBNZ surprised with a 50bp cut. Pair was last at 0.5759 levels, OCBC's FX analysts Frances Cheung and Christopher Wong note.
The Reserve Bank of New Zealand surprised with a 50bp rate cut today. Furthermore, guidance remained dovish, signalling openness to further reductions, resulting in a 1% drop in NZD/USD, ING's FX analyst Francesco Pesole notes.
The situation in France may have little impact on the Euro (EUR). Usually, investors do not necessarily have to buy OATs, but can fall back on German government bonds as a safe haven.
The outgoing French prime minister has been asked by President Macron to give one final shot at bringing together the deeply divided parliament and form a government that can deliver on urgent budget issues, ING's FX analyst Francesco Pesole notes.
EUR/JPY remains stronger for the fourth successive session, trading around 177.40 during the European hours, near 177.46, an all-time high reached on Wednesday.
EUR/USD keeps hovering right above one-month lows at 1.1605, weighed by investors' concerns about the fragile political and fiscal situation in France.
The only risk for gold is the Fed and a hawkish repricing in interest rates expectations. The shutdown keeps those risks away by delaying the release of key data and not giving the Fed members much to work with.
The NZD/USD pair extends the previous day's sharp retracement slide from levels just above mid-0.5800s, or a nearly two-week high, and attracts heavy selling for the second straight day on Wednesday.
The AUD/JPY cross extends its upside to around 100.05 during the early European session on Wednesday. The Japanese Yen (JPY) faces some selling pressure against the Australian Dollar (AUD) as traders assess the likely policy stance of Japan’s next Prime Minister, Sanae Takaichi.
Silver (XAG/USD) regains positive traction following the previous day's modest pullback and climbs to the $48.30 region during the Asian session on Wednesday.
Elon Musk’s xAI is expanding its fundraising to $20 billion, with Nvidia investing up to $2 billion in equity and supplying GPUs for its new Colossus 2 data centre. The deal, structured through an SPV that leases chips back to xAI, combines equity and GPU-backed debt led by Apollo, Valor, and Diameter.
The RBNZ surprised markets with a 50-bp rate cut to 2.50%, citing weak growth and soft inflation pressures. The move sent the New Zealand dollar and swap rates lower and opened the door to more easing as the central bank seeks to revive demand and support the struggling economy.
The USD/CHF trades at around yearly lows of 0.7980, capped on the downside by the 20-day Simple Moving Average (SMA) of 0.7951 and by the 50-day SMA at 0.8008. At the time of writing, the pair hovers around 0.7980, virtually unchanged.
EUR/USD falls on Tuesday amid the political turmoil in France along with the US government shutdown. The Dollar which previously depreciated is posting a surprising recovery up 0.52% in the day, according to the US Dollar Index (DXY). The pair trades at 1.1654, down 0.46%.
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