Forex Today: concerns about a US recession keep the greenback under pressure
|Here is what you need to know on Thursday, October 3rd:
- The greenback maintained its sour tone amid persistent fears about a US recession. US ADP survey came in slightly below the market’s expectations at 135K, exacerbating the dollar’s weakness.
- The EUR/USD pair advanced toward 1.0963, a three-day high amid dislike for the greenback. Advance remains corrective and could extend to 1.1000.
- The GBP/USD pair finished the day little changed around the 1.2300 figure, despite UK PM Boris Johnson finally presented its proposal on the Irish border, which failed to impress the market and politicians. The plan would see some customs checks in Ireland post-Brexit, as it means that Northern Ireland will stay in the EU single market for goods, but leave the customs union. Irish PM Varadkar crossed the wires ahead of the announcement, saying that it would not be a basis for a deal. UK PM Johnson repeated multiple times that the only alternative to his plan is a no-deal Brexit. Meanwhile, EU’s Juncker welcome UK government’s determination to advance on Brexit talks, while Brexit negotiator Barnier announced that there is progress, but a lot of work still needs to be done.
- The Japanese Yen surged amid prevalent risk-aversion and is poised to extend its advance as Wall Street collapsed. US indexes closed roughly 2.0% lower each.
- Demand for safety sent US government bond yields to one-month lows.
- The Canadian dollar plummeted alongside crude oil prices, weighed by US news, as the EIA reported that commercial oil inventories increased by 3.1 million barrels.
- Cryptocurrencies remained in consolidative mode near their recent lows.
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