Home Daily Commentaries US dollar continues to be king, beating G10 currencies

US dollar continues to be king, beating G10 currencies

Daily Currency Update

The US dollar continues to be king, beating the Aussie dollar, British pound, Canadian dollar and Japanese yen by 0.68%, 0.61%, 0.48%, and 0.26% respectively. The Nasdaq 100 fell over 2% along with the S&P 500 and the Aussie dollar lost around 0.8%, falling towards the lowest level since July at 0.6697.

Despite the US dollar’s strength, the EURUSD pair increased 0.16% against the US dollar towards an intraday high of 1.0017; however, the highest level for the EURUSD yesterday was 1.0024. The US dollar is trying to move higher ahead of the Fed monetary policy release next Wednesday.

In today's session, the US dollar index moved up and down, with US stocks finishing lower but with some bounces. However, the US dollar and US equity markets usually move in opposite directions, and in the end, the US dollar moved close to the highest level and the stock market close to the lowest level of the day range.

Consumer prices surprised the fx markets two days ago, pushing the USD high, and yesterday producer prices helped a little to stop the USD surge; the truth is that US inflation is still stubbornly high and well above the 2% Fed target, meaning that the Fed has to continue raising rates and slowing economic demand.

Key Movers

Headlines from Japanese media showed that the Bank of Japan conducted 'rate checks' for USDJPY at around 144.9. This might mean that the Bank of Japan could intervene in the FX market anytime.

The US dollar soared to 1.3240 versus the Canadian dollar, representing a 0.48% increase, the strongest level since November 4th 2020. Despite Canada's August home sales falling only 1% month to month versus the -1.6% expected. However, this did not help the Canadian dollar to pare losses. The Canadian dollar also lost against the Euro and Japanese Yen by 0.64% and 0.22%, respectively.

Expected Ranges

  • EUR/USD: 0.9960 - 1.0012 ▲
  • GBP/USD: 1.1462 - 1.1554 ▼
  • AUD/USD: 0.6697 - 0.6798 ▼
  • USD/CAD: 1.3154 - 1.3240 ▲