Forex

Dollar edges down; New Zealand and Aussie dollars gain

Reuters LONDON | Updated on June 08, 2020 Published on June 08, 2020

File Photo   -  Reuters

The dollar strengthened against a basket of currencies in overnight trading on Monday but slipped in early London trading, as investors adjusted their expectations for an economic recovery after Friday's US employment data saw markets rally.

A recovery in US employment data lifted hopes of a quicker global economic revival on Friday, but in Europe on Monday the rally in stocks paused as investors turned cautious again.

New Zealand said on Monday that it has eliminated transmission of the coronavirus domestically and will lift all containment measures except for border controls, making it one of the first countries to do so.

The riskier New Zealand dollar rose to its highest in more than four months in overnight trading as the Asian session caught up with Friday's rally, and the Australian dollar was close to five-month highs.

But German industrial plunged the most on record in April as the coronavirus pandemic forced companies in Europe's largest economy to scale back production.

At 0700 GMT, the dollar index was at 96.88, up 0.2 per cent on the day. It then fell to 96.82 by 0740 GMT.

The euro edged up, having slipped down from recent highs, at $1.1299. It hit a three-month high of $1.1384 last week after the European Central Bank announced that it was expanding its stimulus programme.

ECB President Christine Lagarde will speak at the European Parliament at 1345 GMT.

“EUR/USD may be due some consolidation after a very strong rally, but we suspect the 1.1230/40 area offers good support now before EUR/USD advances to the 1.15/16 area,” ING strategists wrote in a note to clients.

They also said the risk of a second wave of COVID-19 and the possibility the Federal Reserve will stop providing cheap liquidity threatened the prevailing narrative of an economic recovery.

Investors are now waiting for more information about a European Union recovery fund proposed last month - a 750 billion-euro plan to prop up European economies hammered by the coronavirus pandemic.

The safe-haven Japanese yen rose against the dollar, at 109.53 at 0730 GMT, but the Swiss franc fell around 0.2 per cent against both the dollar and euro .

Major oil producers agreed to extend a deal on output cuts to the end of July as China's crude imports hit an all-time high in May. The Norwegian crown held close to three-month highs against the dollar and euro as oil prices climbed.

 

Published on June 08, 2020

A letter from the Editor

Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!

Support Quality Journalism
Rupee closes almost flat at 75.58 amid crude shock