A Korea Exchange Bank employee counts $100 bills during a photo shoot at the bank’s headquarters in Seoul on April 28, 2010.Reuters/Jo Young-Hak/File Photo
NEW YORK (Reuters) – The US dollar attracted safe haven bids on Tuesday after a series of disappointing Chinese trade data hurt the yuan, Australian and New Zealand currencies and Europe’s risk-sensitive currencies. increased across the board. A worsening global outlook is also playing a role.
The dollar index rose 0.4% to 102.52, further away from Friday’s one-week low after mixed U.S. jobs data showed the labor market was cooling but still resilient.
Data on Tuesday showed China’s imports and exports fell sharper than expected in July, with imports falling 12.4% and exports down 14.5% year-on-year, indicating a sluggish economic recovery in the country and sluggish global demand. A new sign.
In addition, Moody’s said late Monday that it would cut the credit ratings of several small U.S. banks and downgrade some of the nation’s largest financial institutions. It warned that the sector’s creditworthiness would likely be tested by funding risks and declining profitability.
“Weak economic data from China and Japan, coupled with Moody’s downgrade of US banks weighed on risk sentiment,” said Mark Chandler, chief global strategist at Bannockburn Forex in New York.
“Right now, the foreign exchange markets are voicing concerns about growth prospects as the dollar block (Australian dollar, New Zealand dollar and Canadian dollar) and Skandies (Norwegian and Swedish crowns) underperform against the U.S. dollar. It’s about being there.”
The offshore yuan slid to a five-week low of 7.2514 to the dollar before closing down 0.5 percent to 7.235. In the domestic market, the dollar hit a three-week low of $7.2225.
Directly impacted by the yuan, the Australian dollar, a risk-sensitive currency proxies, fell to US$0.6497 against the US dollar, its lowest since June 1. It had previously traded 0.5% lower at $0.6539. The New Zealand dollar fell to US$0.6035, the lowest level in two months, and ended 0.7% lower at US$0.6063.
Currency movements were minimal early in Asia Day, but the dollar gained more in Europe and North America as risk sentiment weakened and Wall Street stocks sold off.
Among other currencies, the pound fell 0.3% to $1.2745 after a survey showed UK retailer sales growth in July was the weakest in 11 months.
The euro fell 0.4% to $1.0957, while the risk-sensitive Swedish and Norwegian crowns both fell against the dollar.
The US dollar rose 0.7% to 143.40 yen.
Brad Bechtel, global head of FX at Jefferies, said: “There’s no doubt we’re in the dollar smile phase where US fundamentals outperform the rest of the world, and generally the dollar continues to rise. It’s an enabling environment,” he said. yoke.
Data on Tuesday showed Japan’s real wages fell for the 15th straight month in June on relentless price increases, but nominal wage growth remained solid on the back of rising wages for high-income earners and a growing labor shortage. Ta.
All eyes are now on Thursday’s US inflation data, with core US consumer prices expected to rise 4.8% annually in July.
China will also release inflation for July on Wednesday, with traders eyeing signs of further deflation.
Currency bid price at 3:41 PM (1941 GMT)
Reported by Gertrude Chavez-Dreyfus. Additional reporting by Samuel Indyk from London and Rae Wee from Singapore.Editing: Gareth Jones, Jason Neal, Sharon Singleton, Andrea Rich
Our criteria: Thomson Reuters Trust Principles.
