USD rallies against majors
Daily Currency UpdateThe US dollar jumped on Friday after giving up some gains following the interest rate decision by the US Federal Reserve. The Bank of Japan decided to keep ultra-low interest rates unchanged, which weighed on the yen and drove flows to the US dollar. The US dollar continued to benefit from its status as a safe haven asset as growing concerns about an economic downturn had investors moving away from equities.
One reason for the dollar’s weakness over the past 24 hours was the unexpected decision by the Swiss National Bank yesterday to raise rates from -0.75% to -0.25% with the SNB also removing from its policy statement the commentary about the currency being “strong.” Like the US dollar, the swiss franc is a safe haven currency so the prospect of the SNB raising rates further and accepting further strength drew investor funds from USD to CHF.
After a very busy week of central bank policy announcements, it’s a quiet Friday with little economic data of note being released. The US Dollar Index was up 1.26% trading at 104.93 at the time of writing.
Key MoversThe euro and the pound fell on Friday as the US dollar saw renewed demand. Yesterday, the Bank of England raised interest rates for the fifth consecutive meeting to fight inflation at multi-decade highs. GBPUSD was down 1.15% trading around 1.22 while EURUSD fell below 1.05. The Canadian dollar fell to five-week lows against the US dollar as USD broadly strengthened and oil prices took a hit. USDCAD was up 0.81% trading at 1.305 at the time of writing.
- EUR/USD: 1.0453 - 1.0596 ▼
- GBP/USD: 1.2182 - 1.2397 ▼
- AUD/USD: 0.6902 - 0.7067 ▼
- USD/CAD: 1.2894 - 1.3072 ▲