Forex today: Dollar sinks below the 96 handle on lower yields
- AUD/USD extended to highs close to 0.6970 on a weak dollar.
- USD/JPY ranged between 107.25 and 107.55 as investors wait and see...
Forex was in consolidation in the main, considering the indecisive mood that commenced in Asia yesterday, filtering its way through to European markets and continuing on in New York. The dollar, for the most part, was holding its ground around the 96 figure after making a fresh low scored at 95.97. Investors are waiting to see the outcome of the G20 at the end of this week and what Federal Reserve's Powell has to say in a speech in New York today.
As for yields, the US 10yr treasury yields dropped from 2.05% to 2.01%, while 2yr yields fell from 1.77% to 1.73%. Following Friday's speakers, the Federal Reserve's Dallas Fed president Kaplan, who is a voter n 2020, not this year, said that he is concerned that cutting interest rates now “would contribute to a build-up of excesses and imbalances in the economy which may ultimately prove to be difficult and painful to manage.”
As for data, it's pretty quiet out there as we get set for a speech by Fed chair Powell speaking in the NY afternoon on the Economic Outlook and Monetary Policy, including Q&A. Williams will be speaking as well at the OPEN Finance Forum, with Bostic on housing, and Barkin in Ottawa on the same day. Overnight, the Dallas June Fed manufacturing index was falling noticeably. In early Asia, New Zealand released the trade balance for Mat as follows: New Zealand trade shows a 264m surplus vs the expected 250m
Analysts at Westpac offered a summary of the key overs for Asia today from overnight as follows:
- The US dollar slipped against most G10 currencies over the day. EUR/USD rose from 1.1375 to 1.1400.
- Sterling underperformed, net unchanged at 1.2735.
- USD/JPY ranged between 107.25 and 107.55.
- AUD/USD extended to highs close to 0.6970, the Aussie second only to the Swedish krona in the G10 over the day.
- NZD/USD rose from below 0.6600 to 0.6620.
- AUD/NZD ranged between 1.0510 and 1.0550.
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