Forex Today: Trading remains choppy ahead of year-end
|What you need to take care of on Thursday, December 29:
The US Dollar dollar advanced in the last trading session on Wednesday, helped by a souring market mood. Global stock markets closed in the red, with the focus still on China and the potential effects of a full reopening. On the one hand, market players welcomed news the government is shifting away from its zero-covid policy to favor economic growth. On the other, it fears that such change would fuel price pressures and put skyrocketing inflation under the spotlight. Major indexes are headed to post the worst year in over a decade.
The 10-year US Treasury note yield stands at 3.88%, more than double the roughly 1.5% it offered at the end of 2021. The 2-year note currently yields 4.35% after paying around 0.75% at the beginning of the year. One thing leads to another, as speculation inflation could rise again, pushing yields at the shorter end of the curve higher, which in turn, fuels concerns about a potential recession.
OPEC+ detached from the Russian decision to cut oil exports to countries that adhere to the price cap. Crude oil edged lower intraday but trimmed intraday losses ahead of the close. WTI trades at around $78.80 a barrel.
Spot gold eased further but managed to retain the $1,800 level and trades at $1,805 a troy ounce.
Commodity-linked currencies were firmly lower, weighed by stocks and oil prices. USD/CAD trades at around 1.3600, while AUD/USD hovers around 0.6740.
The EUR/USD pair remains above 1.0600, down for the day while GBP/USD hovers around 1.2025. Finally, the USD/JPY pressures its weekly highs in the 134.30 region.
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