Dollar Strengthens As Traders Vacate Safe Havens
The dollar is gaining ground against all of its major rivals Monday afternoon, but its gains are most pronounced against the Japanese Yen. Traders piled into safe havens, like gold and the Yen, at the end of the previous trading week. At the time, Hurricane Irma was predicted to wreak havoc on Florida and traders feared that North Korea would launch another missile to coincide with its national holiday.
Investors have regained their appetite for risk at the start of the new trading week, after North Korea refrained from launching any missiles and the damage from the Hurricane was less than had been predicted.
There was no U.S. economic data to drive trading this morning and there will be very little to speak of until the end of the week. The consumer price index and weekly jobless claims are set for release on Thursday, while retail sales, industrial production and consumer sentiment are all slated for Friday.
The dollar has climbed to around $1.1965 against the Euro Monday afternoon, from an early low of $1.2029.
The French economy is expected to grow at a steady pace, as previously projected, in the third quarter, according to survey data published by Bank of France. Gross domestic product is forecast to expand 0.5 percent in the third quarter, in line with the second estimate, and the same as in the second quarter.
Investors are awaiting the results of a key vote on the European Union (Withdrawal) Bill in the U.K. Parliament. U.K. lawmakers are debating the bill in the House of Commons with a vote due later today or early Tuesday. The legislation is aimed at transferring European Union legislation into U.K. law on the day the country leaves the bloc in March 2019.
Traders are also looking forward to the policy decision from the Bank of England on Thursday.
The buck slipped to a low of $1.3222 against the pound sterling Monday morning, but has since bounced back to around $1.3175.
The greenback has jumped to around Y109.250 against the Japanese Yen this afternoon, after falling to a 10-month low of around Y107.300 on Friday.
Core machine orders in Japan surged a seasonally adjusted 8.0 percent on month in July, the Cabinet Office said on Monday, standing at 853.3 billion yen. That beat forecasts for an increase of 4.1 percent following the 1.9 percent decline in June.
Japan's tertiary industry activity recovered in July, data from the Ministry of Economy, Trade and Industry showed Monday. The tertiary industry activity index gained 0.1 percent month-on-month in July, reversing a 0.2 percent drop in June and flat growth in May. The monthly rate came in line with expectations.