The US dollar (USD) is being widely strengthened due to geopolitical tensions, since market participants respond to the news of Israeli air attacks launched against Iran, says Shaun Osborne, head of Scotiabank’s chief strolle.
The USD benefits from the classic risk aversion
“The distribution of FX yields is a classic risk aversion with low performance of the AUD and NZD, weakness in the MXN and SEK, and losses for the EUR and GBP. The weakness in the classic shelter Chf and JPy shelter is something surprising, despite its relative performance against the pairs of the G10. The CAD and the Nok are having a better performance, understandably, given their relationship with the prices of oil.
“The yields of the Treasury bonds, meanwhile, have completely recovered their initial falls and are marginally taller compared to the closing levels of Thursday. However, the increase in oil prices is remarkable, and oil prices are maintaining their night gains, with the WTI quoting in the $ 70, a significant increase since the closing of Thursday around 68 $/BB Recent minimums driven by the excess supply of the OPEC, just above 55 $/BBL.
“The American session approach will remain focused on geopolitical developments and the possibility of escalation. In terms of data, USA will publish the preliminary data of UMICH consumer’s feeling, a critical publication before the FOMC meeting next week. Those responsible for monetary policy have been historically sensitive to data, and the figures have an even greater risk after IPC and IPC data Disinflationary this week, as well as the worrying data on unemployment requests that have revealed continuous deterioration in the US labor market. The Fed continues in its period of silence before the FOMC meeting next week, however, we point out the potential of a significant risk of holders around the G7 leaders summit, scheduled for Sunday until Tuesday. “
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
