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Currency Market Analysis

Feb 04, 2020 | Currency Market Analysis

Global Themes

USDSGD surges higher as Chinese shares, commodities tumble

The USDSGD was sharply higher after yesterday’s highly anticipated Chinese return saw shares and commodity markets smashed.

The Shanghai Composite fell 7.7% while key Chinese commodity markets opened “limit down” with copper, iron ore and rubber all falling their maximum-allowed 10%.

Overnight, however, US equities managed to claw back some gains after last week’s heavy selling.

Safe haven boost

The other safe haven currencies continued higher with the Japanese yen and Swiss franc both stronger.

The British pound fell as markets grew increasingly worried UK prime minister Boris Johnson might take a hard-line over trade negotiations with the European Union.

RBA

Today’s focus is on the Reserve Bank of Australia.

The market sees a 31% chance of a rate cut but this might be overstated with bond yields around the world collapsing due to fears about the flu-like coronavirus.

The RBA announcement is due at 12:30am.


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