Morgan Stanley: US Dollar to Strengthen on Yuan Move
The US dollar will strengthen against non-Asian currencies, following China’s move to drop the yuan’s two-year-old currency peg to the greenback, according to Morgan Stanley. The People’s Bank of China signaled that it will drop the yuan peg to 6.83 US dollars, which the central bank implemented in order to shield China’s domestic export industry…. Continue Reading
Risk Demand Strong; Euro, Crude Oil Gain
Demand for risk appears broad-based and quite strong in early trading, potentially signaling renewed strength in the short-term. The euro is gaining sharply on the session against the US dollar, which speaks volumes for risk appetite. Last priced at 1.2290, the EUR/USD traded above the 1.23 handle earlier in the session. Crude oil, too, is… Continue Reading
UBS: US Dollar to Become Growth Currency
The US dollar will become known as a growth currency — not just a safe haven — over the next 10 years, according to UBS. Mansoor Mohi-uddin, global head of Forex strategy at the firm, argues that the US economy is set to outpace its counterparts in Europe and Japan. As a result, the dollar… Continue Reading
Morgan Stanley: ‘Elevated’ Risk of G3 Intervention
Morgan Stanley sees an “elevated threat” of a currency intervention by the central banks of the U.S., Europe and Japan going forward. According to Sophia Drossos, co-head of currency strategy at the firm, a joint intervention by the Group of Three is growing increasingly likely. Ms. Drossos adds, “The strongest warning signals in our model… Continue Reading
Markets Bounce Off Lows on Weak Risk Demand
Equities markets and broader appetite for risk have recovered from their session lows, as the German parliament passes the eurozone bailout and a key technical level was revisited. However, riskier assets are positioned to resume their declines going forward. The Dow and S&P 500 shot to positive territory and the US dollar weakened, right after… Continue Reading
Risk Trade Blows Up (As Warned Repeatedly)
The risk trade is once again under attack, with crude oil, gold and equities all sharply lower and the US dollar and Japanese yen generally higher. Crude oil contracts for June delivery are down $1.15 per barrel to $68.70 per barrel. Gold, too, is falling in early trading, last priced at $1,187 per ounce —… Continue Reading
US Dollar Surging on Risk Selloff; Commodities, Equities Notably Weak
The US dollar continues its upward move, as the risk trade continues to unwind. Excepting the Japanese yen, the US dollar is higher across the board in early trading, with the euro nearing its lowest levels against the greenback since 2008. Last priced at 1.2445, the EUR/USD traded as low as 1.2330 in October 2008,… Continue Reading
Crude Oil Falls Below $74; Further Downside to $70
Crude oil is continuing its move lower in early trading, surpassing its lows during last week’s crash. Crude oil contracts for June delivery traded as low as $73.71 per barrel today, taking out its final support through the $70.75 level. The latest price on crude is $74.20 per barrel, still below the $74.49 low during… Continue Reading
Bank of Tokyo: Sell British Pound Against US Dollar
The sterling may drop to 1.38 against the US dollar, as interest rates will likely remain depressed on government spending cuts, according to Bank of Tokyo Mitsubishi UFJ. Derek Halpenny, European head of currency research at the firm, wrote to investors today: The downbeat assessment from Governor King yesterday, the confirmation from the election outcome… Continue Reading
GBP/USD Higher on Coalition Hopes; Downtrend to Resume
The GBP/USD is getting a boost on speculation that a coalition government has been formed in the UK. However, the temporary rebound is likely to give way to the longer term downtrend in the days ahead. The British pound has recovered nicely from its session low of 1.4720 against the US dollar, last trading at… Continue Reading
