US Dollar gains against safe-havens as risk sentiment spurs up on Omicron news

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US Dollar gains against safe-havens as risk sentiment spurs up on Omicron news

On Monday, the US Dollar Index (DXY) measured against a basket of six major currencies on an average, gained 0.2 per cent to 96.22 as safe-haven majors like of Japanese Yen and Swiss Franc tumbled against their American peers following reveal of media headlines that patients infected with the newly identified Omicron variant were showing only mild symptoms, while global economic risk-associated loonies likes of Australian Dollar faltered over growing frets on global economic growth.

In point of fact, earlier in the day, the head of US CDC (Center for Disease Control and Prevention), Dr. Anthony Fauci, was quoted saying in an interview with CNN that “Thus far it does not look like there's a great degree of severity to it,” heightening up appetite for riskier assets even as Omicron variants had reportedly spread across a third of the United States.

Apart from that, Physicians in South Africa, the epicenter of current Omicron outbreak, had told that their initial observations had suggested the newly identified B.1.1.529 variant of pandemic pathogen, named as Omicron, would more likely to cause mild flu-like symptoms, stoking hopes that Omicron-associated economic fallouts would be far less severe than initially estimated.

Amid such pluperfect market backdrop for riskier assets, safe-haven assets including US gold futures’ prices had pummeled, while US Treasury bond yields ticked higher with US 10-year Treasury bond notes rising as much as 0.09 per cent to 1.43 per cent.

US Dollar gains as risk-appetite returns amid ease in Omicron fears

Citing statistics, in the day’s FX market round-off, safe-haven Japanese Yen shed 0.56 per cent to 113.44 yen per Dollar against its American counterpart, while Swiss Franc lost 0.83 per cent to $0.9253.

Aside from that, the bloc’s common currency euro, shared among 19 eurozone-member states, tumbled 0.23 per cent to $1.1283, while British Pound advanced 0.19 per cent to $1.3257. On top of that, amid a torrential high-tide in crude oil futures’ prices, commodity-linked loonies jumped with Canadian Dollar climbing 0.66 per cent to $1.2760, clawing back from a nearly 2-1/2-month low.

Meanwhile, addressing to a lack of negative stimulus on the day’s FX market, a chief market strategist at Bannockburn Global Forex wrote in a client note, “The absence of negative developments surrounding Omicron over the weekend appears to be helping markets stabilize today after the dramatic moves at the end of last week”.