Dollar Up, Supported by Global Growth Fears

The dollar was up on Monday morning in Asia, global growth fears helped the safe-haven dollar gain more broadly.

The U.S. Dollar Index that tracks the greenback against a basket of other currencies gained 0.29% to 107.32 by 05:42 GMT.

“The dollar is strengthening across the board, but dollar-yen is leading the move,” National Australia Bank currency strategist Rodrigo Catril told Reuters.

The Bank of Japan Governor Haruhiko Kuroda said earlier in the day the central bank “won’t hesitate to take additional monetary easing steps as necessary”.

Dollar Up 1.0 - Exciting New App Teaches Money to Special Needs Kids

The AUD/USD pair fell 0.59% to 0.6816, and the NZD/USD pair eased 0.40% to 0.6167.

The USD/CNY pair gained 0.21% to 6.7093, while the GBP/USD pair dived 0.35% to 1.1986.

In China, Shanghai reported its first case of the highly infectious BA.5 omicron sub-variant on Sunday and warned of “very high” risks, stoking fears of more lockdowns. Beijing has also vowed to shore up the economy.

“The (dollar) could remain expensive until the risks around elevated global inflation, European energy security and China’s growth outlook have been resolved,” Barclays analysts said in a note.

Fears of high inflation and slowing economic growth continue to weigh on markets. U.S. unemployment rate remained at 3.6% which eased some recession fears, raising expectations of more monetary tightening.

Treasuries edged lower, taking the U.S. 10-year yield toward 3.1%.

Investors now await U.S. Consumer Price Index (CPI), due this Wednesday, which is expected to get closer to 9%, a fresh four-decade high.

“This week’s U.S. CPI will be an important piece of the puzzle as the Fed decides between 50 basis points and 75 basis points ahead of the July meeting,” Barclays analysts said.

The market is also watching the energy supply. The maintenance of the Nord Stream 1 pipeline, the biggest single pipeline carrying Russian gas to Germany, is due to run from July 11 to 21. Markets are worried the shutdown would be extended over the war in Ukraine.

Elsewhere, the Reserve Bank of New Zealand will release its policy decision on Wednesday, followed by the Bank of Canada.


Where to contact us :

Website : www.forextrade1.co
Twitter : www.twitter.com/forextrade11
Telegram : telegram.me/ftrade1
Facebook : www.facebook.com/Forextrade01
Instagram : www.instagram.com/forextrade1
YouTube : www.youtube.com/ForexTrade1
Skype : forextrade01@outlook.com
Email ID : info.forextrade1@gmail.com
Discord : https://discord.gg/vEk98ZvrHP
LinkedIn : https://www.linkedin.com/company/forextrade11