U.S. Dollar Climbs Amid Risk Aversion
August 12 2019 - 11:26PM
RTTF2
The U.S. dollar strengthened against its major counterparts in
the Asian session on Tuesday, as continued U.S.-China trade
tensions, protests in Hong Kong, the defeat of President Mauricio
Macri in Argentina raised the appeal of safe-haven assets.
Asian markets slipped as China bank lending data disappointed
and the People's Bank of China guided the yuan lower for a ninth
straight session, adding to fears of a global currency war. The new
U.S. tariffs on some $300 billion in Chinese imports would go into
effect on Sept. 1.
The Argentine peso collapsed following Macri's stunning defeat
in primary elections over the weekend.
Operations resumed at Hong Kong airport on Tuesday morning, a
day after a pro-democracy protest brought the air transport hub to
a complete standstill.
The U.S. consumer inflation is due later today, with economists
expecting a rise of 0.3 percent on month in July.
Investors await the U.S. Federal Reserve's annual symposium at
Jackson Hole later in the week for more clarity on the future
course of interest rates.
The greenback strengthened to 105.58 against the yen, from a low
of 105.16 hit at 5:30 pm ET. If the greenback rises further, 107.00
is seen as its next resistance level.
Data from the Bank of Japan showed that Japan producer prices
were flat on month in July, following the 0.5 percent drop in
June.
On a yearly basis, producer prices sank 0.6 percent after easing
0.1 percent in the previous month.
Reversing from a low of 1.1220 seen at 5:45 pm ET, the greenback
edged higher to 1.1182 against the euro. The next possible
resistance for the greenback is seen around the 1.10 level.
The greenback that closed yesterday's trading at 0.9692 against
the franc advanced to 0.9727. The greenback is likely to find
resistance around the 0.99 level.
The greenback ticked up to 1.2042 against the pound from
yesterday's closing value of 1.2075. The greenback is seen finding
resistance around the 1.19 level.
The greenback firmed to a 4-day high of 1.3253 against the
loonie, compared to 1.3238 hit late New York Monday. On the upside,
1.34 is possibly seen as the next resistance level for the
greenback.
Looking ahead, U.K. ILO jobless rate for three months ended June
and German ZEW economic sentiment index for August are scheduled
for release in the European session.
In the New York session, U.S. consumer price index for July is
due.
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