Currency Market Analysis

Jun 29, 2018 | Currency Market Analysis

Global Themes

USD climbs further as Dow rebounds, CNY pressure extends

The US dollar continued higher yesterday as US sharemarkets climbed.

The US dollar has outperformed as major currencies are pressured by recent financial stress.

In particular, the Chinese yuan continues to see further losses, with the Chines currency at six-month lows versus the greenback.

NZD hit

The euro rebounded from major support while Japanese yen fell.

The NZDSGD dropped to two-year lows as markets reacted to a more negative-sounding RBNZ which downgraded growth forecasts and suggested the next move in NZ rates might be lower.

The NZD, like the Australian dollar, has also been pressured by this month’s US Federal Reserve rate hike. Both the NZD and AUD are highly sensitive to shifts in US interest rates.

Euro in focus

The focus tonight will be on European inflation.

The forecast is for annual inflation to fall back to 1.0% from 1.0%.

Also, the key EU summit means the euro will be a major driver in today’s markets.

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