The US Dollar Remains Strong versus The Australian Dollar
The safe-haven US dollar was highest in the week. In contrast, the Australian dollar, Chinese yuan, and euro were pressured by dismal global economic data fueled recession fears.
A slew of dismal global economic indicators fueled the worldwide safety bid. On Monday, data indicated that confidence among US single-family homebuilders and factory activity in New York state dipped in August to their lowest levels since the onset of the COVID-19 outbreak.
The DXY compares the greenback to six major currencies. It remained stable at 107.51, slightly below the previous session’s high of 107.55, the highest since last week’s Monday.
The euro barely moved at $1.0758 after falling to its lowest level since August 6 at 1.0254.
It came on the heels of unexpectedly disappointing Chinese activity figures spanning industrial output, retail sales, and fixed-asset investment, as the country’s embryonic rebound from severe coronavirus lockdowns failed.
The dollar strengthened 0.08% against the offshore yuan to 6.8274. It is heading back toward Monday’s high of 6.7200, a level not seen since mid-May.
Sterling was 0.1% down at $1.2040, its lowest level since August 5.
The dollar fell 0.08% to 133.19 against the yen, a popular safe-haven currency.
The AUD fell to $0.7105. It might fall below the psychologically important 70-cent threshold first time since Wednesday.
The New Zealand kiwi fell. It was at $0.6349, the lowest level since Wednesday.
On Wednesday, The New Zealand Reserve Bank should raise interest rates by half a point again. The outcome depends on whether policymakers follow the lead of the Reserve Bank of Australia in adopting a more data-driven strategy.
The weakness of the US and Chinese economies is often a bad indicator for commodities currencies,” particularly the Australian and New Zealand dollars.
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