What you need to know on Thursday, October 21:
The dollar remained under selling pressure and lost ground against all its main rivals, including the considered safe haven. The US dollar enjoyed some temporary demand at the start of the European session, as US government bond yields jumped to new multi-month highs, with the 10-year Treasury yield reaching a high of 1,673%, but fell back to 1.64%. At the beginning of the year, a yield above 1.70% used to trigger strong demand for the dollar.
The EUR / USD pair is trading around 1.1650, posting a modest intraday advance. European Central Bank lawmaker Francois Villeroy repeated that current inflation spikes are expected to be temporary. The EU released the final version of the Consumer Price Index for September, which was confirmed at 3.4% year-on-year in September, while the underlying annual reading was 1.9%, validating the wait-and-see stance of the European Central Bank.
GBP / USD ended the day above 1.3800 despite mixed UK inflation data. The Consumer Price Index was 3.1% year-on-year in September, compared to 3.2% in August. The underlying reading fell to 2.9% yoy last month from 3.1% in August, disappointing the consensus forecast of 3.0%. Regardless, the BOE is expected to raise rates sooner rather than later, which helped keep the pound afloat.
Commodity-linked currencies hit new multi-month highs against the dollar. AUD / USD is trading around 0.7520, while USD / CAD hits the 1.2300 mark. The USD / JPY pair marked lower and settled at 114.26.
Gold posted a third consecutive daily high and stood at around $ 1,784 a troy ounce. Crude oil prices fell ahead of the US opening, but ended the day at fresh multi-year highs. The WTI closed at $ 83.25 a barrel.
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