ছবি Photo from Reuters file: US dollar bill seen on a light table in Washington’s Bureau of Engraving and Printing, November 14, 2014. Reuters / Gary Cameron / File Photo / File Photo
Written by Anushka Trivedi and Tom Westbrook
SINGAPORE (Reuters) – The dollar started near the year’s highs in the last quarter of 2021, and was heading for its best week since June as investors expected the Federal Reserve to raise US interest rates faster than its key counterparts.
A Washington Gridlock also backed the dollar, which is seen as a safe haven, ahead of a deadline set by cautious market sentiment, a slump in China’s growth and a lifting of the US government’s orrow’s limit.
Standing at 94,287, it has risen 1.1% so far this week, the biggest weekly increase since the end of June.
The euro was stable at 15 1.1578 on Friday, but fell about 1.3% during the week, and touched its lowest level since July 2020 with major support at around 16 1.16.
The yen bounced overnight from a 19-month low but fell 0.6% for the week and doubled in one week as the dollar flowed from Japan due to an increase in U.S. Treasury yields. It was last traded at Rs 111.21 per dollar.
Benchmark 10-year Treasury yields are rising for the sixth consecutive week and actual 10-year yields (), discounts for inflation, are growing much faster than their European counterparts.
“As long as the market remains confident that the U.S. will start tightening monetary policy within a reasonable period of time, the dollar should stay good,” said Sociedad General (OTC 🙂 strategist Kit Jukes.
“The European Central Bank is likely to keep rates below zero, while the Fed hikes will have to keep the euro / dollar in the post-2014 range, with a center of gravity of around 12 1.12-1.16,” he said.
Commodity currency bounced back to the dollar on Thursday after a Bloomberg report said China had instructed energy companies to ensure supplies at any price in the winter, but came under pressure again on Friday.
Beijing is scrambling to supply more coal to utilities to restore supply amid market turmoil due to the potential impact of economic growth amid the power crisis.
The Australian dollar fell 0.3% to 7 0.7203 and fell 3.6% in the third quarter – the worst performance of any G10 currency against the dollar – as Australia’s top export, iron ore, fell sharply. The New Zealand dollar fell 0.2% to 68 0.6882.
The two countries will have a central bank meeting next week, where the Reserve Bank of New Zealand will watch the hike, and the Reserve Bank of Australia is expected to live up to its forecast for 20224.
Sterling was also lower last quarter, down 2.5%, and ready to log its worst week in more than a month, sounding a hawk despite growing supply chain problems due to central bank concerns. [GBP/]
Sterling traded down 0.2% at 9 1.3452, a 9-month low.
Still, some analysts believe the dollar will soon lose some momentum. Bank of Singapore analyst Mohd Siang Sim said the decline in global Covid-1 cases could increase towards the end of the year.
Markets in Hong Kong and China closed on Friday. Towards the end of the day, traders are waiting for data on U.S. personal spending and core spending cuts and are looking nervously at any progress in the debate over raising the U.S. debt limit.
Deadline for approval of additional Treasury orrowing in mid-October.
================================================== ====== ======
Currency bid price at 0624 GMT
Description RIC Last US Close Pct Change YTD Pct High Bid Low Bid
1.1580 $ 1.1578 + 0.03% -5.21% +1.1583 +1.1564
Dollar / Yen
111.1350 111.3550 -0.11% + 7.69% +111.4800 +111.1650
Euro / Yen
128.69 128.82 -0.10% + 1.39% +129.0400 +128.6700
Dollar / Swiss
0.9314 0.9317 -0.02% + 5.29% +0.9333 +0.9314
Sterling / Dollar
1.3449 1.3477 -0.22% -1.58% +1.3480 +1.3445
Dollar / Canadian
1.2728 1.2685 + 0.34% -0.04% +1.2734 +1.2678
Aussie / Dollar
0.7198 0.7227 -0.39% -6.43% +0.7240 +0.7194
USD / USD 0.6880 0.6897 -0.23% -4.18% +0.6904 +0.6881
Stains of Europe
Tokyo Forex Market Information from BOJ