American Dollar drops as risk appetite improves; 10-year US Treasury bonds at 1.57%
by SOURAV D | VIEW 869
Ahead of a pivotal April jobs report scheduled to be released on Friday, the American Dollar tumbled against most major and emerging market currencies, hitting a nearly one-week low amid an unprecedented rise in risk appetite following release of a raft of upbeat economic data earlier in the day. US Labour Department said in a statement earlier in the day that the number of Americans filing for first-time state unemployment benefits dipped below 500,000 for the first time since mid-March 2020, suggesting further progress in a booming US labour market, while other economic data released earlier in the day had unveiled that the American employers shed the lowest number of jobs in more than 21 years last month, stoking appeals of riskier assets. In factuality, US Dollar momentarily recouped from a broad-based weakness earlier this week after US Treasury Secretary Janet Yellen had been quoted saying that the interest rates could be raised gradually, though US Fed had nullified the possibility of any kind of rate hike in a near term on Wednesday, leading to a downward spiral of US Treasury bond Yields alongside the American currency.
US Dollar falls, shrugs off safe-haven bid
Citing statistics, in the day’s FX market wind down, the US Dollar Index (DXY) measured against a basket of six major currencies on an average fell 0.3 per cent to 90.94, while the safe-haven Japanese Yen alongside Swiss France gained 0.11 per cent and 0.54 per cent respectively to 109.08 yen per share and $0.9079 against their American counterparts.
Besides, the eurozone’s common currency euro, shared among the bloc’s 19 member states, rose 0.48 per cent to $1.2062 and the Australian Dollar, a closely observed proxy for global trade risks, soared 0.46 per cent to $0.7782.60 against its American peer, while Canadian Dollar extended its latest round of blistering rally, skyrocketing as much as 0.91 per cent to $1.2154.
Meanwhile, addressing to a persistence weakness in American currency over upcoming weeks, a senior market analyst at FX broker OANDA in New York, Edward Moya said, “The outlook for the dollar by many right now that it’s going to be in the house of pain for quite some time, because for the most part, the markets are convinced that the Fed has Treasury yields under control. ”