Forex Today: Markets start the week with optimism
What you need to take care of on Tuesday, October 4:
The greenback resumed its decline at the beginning of the week, ending Monday with losses across the FX board. The EUR/USD pair was able to post a modest advance and settled around 0.9820, with the shared currency among the worst performers against the USD. Downwardly revised S&P Global Manufacturing PMIs weighed on the EUR.
Financial markets traded with optimism, despite persistent recession concerns. Political and financial turmoil in the United Kingdom keeps triggering volatile market reactions and leading the way. The UK government came up with a potential tax cut of a 45% rate on income, but British Finance Minister Kwasi Kwarteng later said they were dropping the idea. The announcement underpinned GBP/USD, which ended the day near an intraday high of 1.1333. Following UK news, European indexes reverted early losses and settled in the green.
The greenback tried to advance ahead of the US opening, but tepid local data put it back on the bearish path. The ISM Manufacturing PMI contracted to 50.9 in September, barely holding in expansion territory.
Wall Street picked up where European indexes left and posted a substantial advance, further undermining demand for the USD. US Treasury yields retreated, with the yield on the 10-year Treasury note down roughly 15 bps.
The AUD/USD pair regained the 0.6500 threshold ahead of the Reserve Bank of Australia monetary policy decision. USD/CAD settle near its intraday low at around 1.3630.
Finally, the dollar posted uneven advances against its safe-haven rivals, with USD/CHF now trading at 0.9930 and USD/JPY at 144.75.
Gold soared and flirts with $1,700 a troy ounce, while crude oil prices also advanced. WTI is currently trading at around $83.50 a barrel.
Government bond yields were sharply lower but moved off their intraday lows ahead of the close.
Dogecoin’s 4-month long consolidation set to drive investors away unless DOGE reclaims this level
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Author
Valeria Bednarik
FXStreet
Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.
