This Tuesday, the dollar globally experiences an increase after from briefly falling to one-month lows as US bond yields decline. Simultaneously, uninspiring economic data puts pressure on the euro.
Surveys reveal a surprising decline in business activity in the euro zone this month, with widespread deterioration across the region, hinting at the possibility of the bloc entering a recession.
The euro advances 0.1% to 1.0684 dollars, changes direction and falls 0.43%, reaching 1.0624 dollars after the publication of this unfavorable data.
Particularly discouraging are the numbers from Germany. The Purchasing Managers Index shows the services sector joining the beleaguered manufacturing sector as it enters contraction territory.
The depreciation of the euro boosts the dollar index, which measures the strength of the US currency in relation to its main counterparts. The index gains a 0.33%, reaching 105.95, after having fallen to 105.35its lowest level since September 22.
Jane Foley, head of currency strategy at Rabobank, says economic weakness in the euro zone and Germany compared to the United States is likely to limit any further declines. of the dollar. He cites factors such as the slowdown in China, higher energy costs and demographic issues as possible reasons behind this economic weakness.
Global financial markets are affected due to rising US government bond yieldswith the 10-year bond yield surpassing 5%, its highest level since July 2007. This increase in returns leads the dollar index to reach a nearly one-year high this month.
The dollar rises slightly, less than 0.1%, reaching 149.83 yen, once again approaching the 150 mark, which often worries traders due to the possibility of government intervention to support the Japanese yen. Earlier in the session, the dollar had fallen against the yen.
In the coming days, US Gross Domestic Product data is expected to be released on Thursday and inflation data on Friday, which could cause further fluctuations in bond yields and currency markets.
Source: Ambito
I am a 24-year-old writer and journalist who has been working in the news industry for the past two years. I write primarily about market news, so if you’re looking for insights into what’s going on in the stock market or economic indicators, you’ve come to the right place. I also dabble in writing articles on lifestyle trends and pop culture news.
