USD retreats as geopolitical tensions rise.
Friday 22nd September
The main release from the US yesterday came in the form of Unemployment Claims which unexpectedly fell from 282K to 259K. This is the second consecutive release that has come in well below forecast and helped build support for the USD following the Fed announcement on Wednesday. Unfortunately for the USD this shift in sentiment was short lived as the greenback retreated off the back of geopolitical uncertainty. Tensions are increasing between the US and North Korea as Kim Jong-Un warns the US and their “deranged” President that they will pay for Donald Trump’s most recent threats. Following this statement, we have seen Asian Stocks rise and the USD retreat as markets take a risk-off approach to investment. Today will see only minor releases from the US as markets will be motivated by sentiment and global events. As a risk-off market continues to grow we could see the USD continue to fall into the close of the week, despite the hawkish rhetoric we have heard from the Fed this week.