top of page
  • Writer's pictureanalysiswatch

Title: Dollar droops as economic optimism saps demand for haven assets

Dec 23, 2021 01:26AM ET

By: Analysis Watch

The dollar, thinking about a place of refuge, sank to an almost one-week low against its significant companions on Thursday as financial backers took a more hopeful position on the worldwide monetary standpoint regardless of the quick spread of the Omicron Covid.

The dollar index, which measures the currency against six peers, fell 0.08% to 96.032 and earlier hit 96.018 for the first time since December 17.

The risk-sensitive Australian dollar was unchanged at $0.72165 after rising 0.86% on Wednesday.

The pound was little changed at $1.3352 after rising 0.63%.

Risk appetite has improved since Monday when markets were rattled by government restrictions related to the Omicron sprawl.

However, data on Wednesday showed that US consumer confidence improved more than expected in December, suggesting that the economy will continue to grow in 2022 despite the resurgence of COVID-19 infections and reduced stimulus spending.

There was also encouraging news from a South African study indicating a lower risk of hospitalization and severe illness among Omicron-infected people compared to the Delta strain.

The euro rose 0.12% to $1.13395, registering another 0.33% gain on the day.

The dollar was little changed at 114.17 yen, another safe-haven currency, holding near Wednesday's near one-month high of 114.37.

Many analysts expect the dollar to strengthen in coming months after the Federal Reserve this month held out the prospect of a March rate hike, setting the US central bank apart from its more cautious counterparts in Europe, Japan, Australia and elsewhere.

In the money markets, the odds of a rate hike at the March meeting are better than 50-50.

0 views0 comments


bottom of page