China's currency regulators are asking some commercial banks to reduce or postpone their purchases of U.S. dollars
That is in order to slow the yuan's depreciation, two people with direct knowledge of the matter said. The informal instruction, or the so-called window guidance, is the latest in a series of steps taken by authorities this year to bolster a currency that has been hit by China's faltering post-pandemic economic recovery and rising yields for the U.S. dollar and other major currencies. Source: Reuters
In case you missed it -> The Yuan exceeds dollar in China's bilateral trade for first time
The yuan was used in 49% of China's cross-border transactions last quarter, topping the dollar for the first time, a Nikkei analysis shows, mainly due to a more open capital market and more yuan-based trade with #Russia. Nikkei looked at international trade by companies, individuals and investors based on currency, using statistical data from the State Administration of Foreign Exchange of China. Nikkei's compilation does not include yuan-based settlements for trades and capital transactions that do not involve China as a counterparty. Source: Asia Nikkei
EURCHF tumbled today as the Swiss Franc saw demand ahead of The Fed and ECB.
The swissy is the strongest vs the euro since Sept 2022 (with the biggest strengthening of CHF vs EUR since January today)... Source: Bloomberg, www.zerohedge.com
Traders are boosting their bets against the US dollar.
Source: The Daily Shot
Most Expensive Euro on Record Has Traders Braced for Declines
As the Nominal effective exchange rate reached an all-time high, a dovish message from ECB this week can add pressure on the euro. Source: Bloomberg
New bulls entering the EURUSD market
EURUSD has broken through strong resistance that has capped advances all year at 1.1080/90. Last week the push higher saw a close at 1.1245, indicating new bulls entering the market and potential for the currency to enter a new range.
Looking ahead, we should see a support around 1.1090/1.1100. On the upside, we might go back to today's high of 1.1276 and potentially to 1.1590, the 76% Fibonacci line from 2021.
Source: Santander & Bloomberg
Dollar’s worst slump since November has some strategists saying a turning point is finally at hand for the greenback
Standard Bank expects ‘multi-year downtrend.’ Dollar bears can also lean on valuation measures. Dollar is overvalued in terms of purchasing power (Big Mac Index) against all major currencies except Swiss franc, the Swedish/Norwegian krona, and the Canadian dollar. Source: HolgerZ, Bloomberg
The pund is the best performing currency (against dollar) YTD ahead of the CHF
The pound is the best performing currency (against dollar) YTD ahead of the swissie. The japanese yen is the only G10 currency to have lost value vs. dollar since the start of the year. Source: Bloomberg
