FOREX dollars rise to a month high; risky currencies fall when equities falter | Business

The dollar rose to its highest level in a month against its basket on Tuesday and risky currencies fell back, as underlying concerns about rising bond yields drove investors back to safe havens.

Rising returns have frightened markets in recent weeks, with participants worried that an economic recovery from the effects of COVID-19, combined with fiscal stimulus, could cause a halt in inflation from pent-up consumer demand when the shutdowns end. Risky currencies including Australian and New Zealand dollars recovered some losses recently on Monday, as returns fell and stock markets rose. But they resumed their decline on Tuesday.

The dollar rose to its highest in a month compared to a basket of currencies, up 0.3% on the day at 91,326 at 0808 GMT, in its fourth straight earnings session. The Swiss franc was the lowest since November 2020 against the dollar. Swiss dollar has risen since the beginning of January and reached about 3.8% so far in 2021.

“With low returns that for the most part are the focus of all equities for now, even if risky assets move back to the positive area later today, the USD can still prove its resilience,” ING strategists wrote in a note to clients. China’s banking and insurance authorities expressed caution against the risk of bubbles bursting in foreign markets, saying Peking studies measures to manage capital inflows to prevent turbulence in the domestic market.

The New Zealand the dollar fell about 0.6% to 0.7222 compared to USA dollar. The Australian decreased 0.3% to 0.7747 compared to USA dollars after the Reserve Bank of Australia undertook to keep interest rates historic.

“However, we continue to believe that the strengthening global recovery driven by continued loose monetary and fiscal policies will continue to support higher commodity prices and a stronger Australian the coming year, “he wrote MUFG currency analyst, Lee Hardman. The euro fell to its peak European Central Bank officials sounded worried about the rise in bond yields.

Politician Francois Villeroy de Galhau said on Tuesday that some of the recent rises were unjustified and that the ECB must push back with the flexibility in its bond buying program. Luis de Guindos, Vice-President of the ECB, said that the ECB had the flexibility to counteract all unwanted interest rate hikes.

Market participants said that the ECB and USA The Federal Reserve took divergent notes on rising bond yields, and the Fed seemed less concerned. At 0842 GMT, the euro fell 0.3% to $ 1.20125 and had reached its lowest point in almost a month.

A quick estimate of inflation in the euro area for February is estimated at 1000 GMT. Elsewhere, bitcoin was one touch lower, down 1% to around $ 49,000 at 0834 GMT, after recovering from some recent losses during the previous session.

(This story has not been edited by Devdiscourse staff and is automatically generated from a syndicated feed.)