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FOREX-Dollar slides as U.S. stocks rally, but sentiment cautious

Published 07/08/2020, 10:51 PM
Updated 07/08/2020, 11:00 PM
© Reuters.
DX
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* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
* Euro extends gains vs dollar
* Commodity currencies rise vs dollar
* Sterling rises after Britain unveils stimulus package

(Adds new comment, FX table, updates prices, changes byline, dateline; previous LONDON)
By Gertrude Chavez-Dreyfuss
NEW YORK, July 8 (Reuters) - The dollar fell on Wednesday, tempering its safe-haven appeal for now, as
U.S. stocks rallied, although sentiment remained cautious amid a resurgence of new coronavirus cases
globally, particularly in the United States.
Demand for the U.S. currency proved remarkably stable as oil prices steadied while European bourses
traded in negative territory.
"The buck tends to struggle when Wall Street rallies," said Joe Manimbo, senior market analyst at
Western Union Business Solutions in Washington.
He added that currencies have largely consolidated given the "the back and forth of optimism over the
economic outlook."
The dollar is typically seen as a safe haven for investors to park their cash each time a resurgence
of the pandemic seems to threaten a global economic recovery.
Against a basket of its rivals, the dollar =USD index dropped 0.5% to 96.527.
The euro EUR=EBS rose 0.6% versus the dollar to $1.1337 marginally, while a recent fall in selling
positions against the greenback provided room for possible further drops.
Commodity currencies, which tend to thrive in times of increased risk appetite, also gained against
the dollar.
The Australian dollar rose 0.4% against the greenback to US$0.6971 AUD=D3 . The New Zealand dollar
NZD=D3 grew 0.2% to US$0.6566, with the Canadian dollar CAD=D3 rising 0.5% to C$1.3543 per U.S.
dollar.
"I think in the absence of any pro-growth news, the virus count will be the one statistic that pops
out from everyone's screens", said Marshall Gittler, head of investment research at BDSwiss, noting that
while it may seem counterintuitive, rising U.S. cases often encourage investors to buy the dollar.
Against the safe-haven yen, the dollar was slightly down on the day at 107.44 yen JPY=EBS . The
greenback was also 0.5% lower versus the Swiss franc at 0.9382 CHF=EBS .
Sterling GBP=D3 shrugged off earlier losses and rose 0.4% to $1.2588, after British finance minister
Rishi Sunak promised 30 billion pounds ($37.7 billion) to head off an unemployment crisis by paying
companies to bring back furloughed workers and cutting taxes for hospitality firms and homebuyers.
Earlier, the onshore yuan CNY=CFXS was stable at 7.0129, halting a two-day rally, after the Chinese
central bank's daily midpoint for the currency was set at a weaker than expected level.
Other Asian currencies straddled narrow ranges as a resurgence of coronavirus cases threatened a return
of lockdown restrictions, leaving investors fretting about the mounting economic costs of the pandemic.

========================================================
Currency bid prices at 10:43AM (1443 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR= $1.1338 $1.1270 +0.60% +1.14% +1.1342 +1.1264
Dollar/Yen JPY= 107.4400 107.5100 -0.07% -1.30% +107.7000 +107.4300
Euro/Yen EURJPY= 121.83 121.20 +0.52% -0.10% +121.8800 +121.1500
Dollar/Swiss CHF= 0.9376 0.9421 -0.48% -3.12% +0.9432 +0.9376
Sterling/Dollar GBP= 1.2588 1.2540 +0.38% -5.06% +1.2595 +1.2510
Dollar/Canadian CAD= 1.3538 1.3602 -0.47% +4.25% +1.3623 +1.3535
Australian/Doll AUD= 0.6967 0.6946 +0.30% -0.77% +0.6974 +0.6928
ar
Euro/Swiss EURCHF= 1.0633 1.0623 +0.09% -2.02% +1.0640 +1.0616
Euro/Sterling EURGBP= 0.9006 0.8987 +0.21% +6.53% +0.9010 +0.8976
NZ NZD= 0.6566 0.6546 +0.31% -2.52% +0.6569 +0.6531
Dollar/Dollar
Dollar/Norway NOK= 9.4087 9.4714 -0.66% +7.18% +9.5144 +9.4036
Euro/Norway EURNOK= 10.6715 10.7055 -0.32% +8.47% +10.7310 +10.6653
Dollar/Sweden SEK= 9.1858 9.2630 -0.22% -1.73% +9.2737 +9.1816
Euro/Sweden EURSEK= 10.4183 10.4416 -0.22% -0.49% +10.4470 +10.4090

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