Forex Today: Yuan slumps on China’s policy move, coronavirus risk downs euro amid light trading


Here is what you need to know on Monday, October 12:

The market sentiment remains buoyed by China’s fresh policy measures, deployed over the weekend, to curb the yuan appreciation while the country’s central bank set financial institutions free from the need to set aside cash when purchasing FX for clients through forwards. 

The US dollar wallowed in two-week lows against its main peers amid dull trading as the American and Canadian markets are closed on Monday, in observance of Columbus Day and Thanksgiving Day respectively.

The Asian equities traded mostly higher, led by the rally in the Chinese stocks amid a slump in the yuan. The US stock futures flashed moderate gains despite all the hopes watered down on a US fiscal stimulus deal likely to be reached ahead of the US election.

House Speaker Nancy Pelosi and Senate Republicans on Saturday rejected President Donald Trump's roughly $1.8 trillion stimulus proposal. Trump's $1.8 trillion offer is a tad better than the $1.6 trillion aid package offered earlier this week but remains well below the $2.2 trillion in the bill House Democrats passed last week.

The coronavirus resurgence in the Old continent is intensifying, with France having reported record-high new daily cases of about 27K on Saturday. In Spain, with Madrid under localized lockdowns, the regions of Catalonia and Navarre will tighten restrictions on working and public gatherings after the continued rise in COVID-19 cases.  

In response to the coronavirus concerns in Europe, the EUR/USD pair gapped nearly 25-pips down in the weekly Asian opening to test the 1.1800 level before reversing towards 1.1830. Focus remains on the ECB President Christine Lagarde’s speech.

GBP/USD refreshed five-week highs at 1.3051 despite the looming Brexit concerns, as the UK PM Boris Johnson gears up or an Australia-style trade deal if there’s no agreement by October 15 deadline.

Also, markets shrug-off rising virus cases in the UK. Stricter virus-led lockdown conditions are set to be announced by the PM for tier-3 hotspots. BOE Governor Andrew Bailey is due to speak at a virtual Citizens' Panel Open Forum.

Gold consolidated last week’s surge to two-week highs of $1930, as the bulls now await a strong catalyst to surpass the critical $1939 barrier.

WTI fell over 1% to $40 mark amid an end to the Norwegian strike and restoration of US oil output, as the hurricane Delta weakened.

Cryptocurrencies consolidated their gains, with Bitcoin keeping its range around $11,300.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD bounces to stabilize around 1.1750

Fears keep ruling the financial boards as rising COVID-19 cases lead to fresh lockdowns across the Union, Germany included. Dollar correcting extreme overbought conditions.

EUR/USD News

GBP/USD falls below 1.30 amid fears of a UK lockdown, Brexit impasse

GBP/USD has dropped below 1.30 as the British government mulls a new lockdown to curb the spread of coronavirus. The pound is also pressured by the Brexit impasse.

GBP/USD News

XAU/USD hits fresh monthly lows near $1,870 and remains vulnerable

Gold is falling sharply and is down almost two percent, even after trimming losses. XAU/USD tumbled to $1,868/oz reaching the lowest level since late-September.

Gold News

Bank of Canada leaves policy rate unchanged at 0.25% as expected

In a widely expected decision, the Bank of Canada (BoC) announced on Wednesday that it left its key rate unchanged at 0.25% following its October policy meeting.

Read more

WTI bounces off lows near $37.00/bbl post-EIA

Prices of the WTI remain on the defensive albeit off lows. Demand concerns dragged prices to 3-week lows near $37.00. EIA reported an unexpected 4.3 mb build during last week.

Oil News

Forex MAJORS

Cryptocurrencies

Signatures