USD starts new year on strong note
Daily Currency Update
Demand for the US dollar pulled back slightly on Tuesday after data showed that a record 4.5 million Americans quit their jobs last month. US Manufacturing PMI also came in for December at 58.7%, 2.4 percentage points from the November reading of 61.1%. The US Dollar Index was sitting at 96.19 at the time of writing.
The safe-haven dollar started the new year with good momentum, putting pressure on the pound, the yen and the Australian dollar as investors assessed the economic impact of rising COVID-19 cases due to the Omicron variant. The dollar was also boosted by a rise in US treasury yields, which are sensitive to rate hike expectations, signaling that the market is bracing for higher rates from the US Federal Reserve.
The pound and the euro rebounded on Tuesday after starting the new year on the back foot against a resurgent US dollar. GBPUSD was up 0.48% at around 1.3543, while the euro was down 0.04% sitting around 1.2923. Demand for the Australian and New Zealand dollars also climbed back up this morning after a strong US dollar forced the commodity currencies lower at the start of the week. AUDUSD was up 0.67% at 0.72392, while NZDUSD was up 0.28% at 0.68053.
- EUR/USD: 1.1275 - 1.132 ▼
- GBP/USD: 1.3461 - 1.3555 ▲
- AUD/USD: 0.7186 - 0.7248 ▲
- USD/CAD: 1.2669 - 1.2763 ▼