The U.S. Dollar
The U.S. Dollar reversed recent losses as the interest rate on the 10-year note rose to its highest level in 14 months, testing 1.75 per cent. The DXY Dollar index, the index that measures the U.S. Dollar’s value against a basket of major currencies, rose from 89.94 to 91.74. Against the Thai Baht, the U.S. Dollar rose quite strongly from a recent flat line of 30.00, (which had been a closely contested level for several months) up to 30.65, a two per cent increase.
The British Pound
After hitting a recent high at 1.4170, The British Pound fell back to 1.3833 before steadying at 1.3870. This could mark the end of long bull run, or it may simply be a temporary retracement ahead of further rises. With uncertainties about Brexit largely now out of the picture, the latter scenario could take precedent. Yet a stronger U.S Dollar has arguably been behind the Pound’s losses. Against the Thai Baht, the Pound gained ground slightly due to the stronger Dollar outweighing the small pullback of late. The Pound stood at 42.75 rising from 42.06. If the pound regains strength against the U.S. dollar then the rise against the Thai Baht could continue in earnest.
The Japanese Yen
The Japanese Yen weakened against the U.S. Dollar from 105.71 to 108.90. When the USDJPY rate rises, this indicates a fall in the value of the Yen since a dollar buys more Yen than it did previously. Once again, U.S. Dollar strength is likely to be behind the move, although the Yen may have lost ground as it gave up some of its safe haven status in reaction to rising stock markets and other risk assets. Against the Thai Baht, the Yen fell very slightly from 0.2814 to 0.2806
The Russian Ruble
The Russian Ruble has continued to trade in a very tight range against the U.S. Dollar moving from 74.33 to 74.06. The millpond action suggests volatility may be ahead since it represents maximum disagreement between buyers and sellers. Against the Thai Baht the Ruble moved from 0.4010 to 0.4154, following the weakening of the Thai Baht against the US Dollar.
The Euro butted heads with the 1.2200 mark against the US Dollar but could not hold that level, giving back recent gains to trade down to 1.1908. U.S. Dollar strength only gave more impetus to potentially end what may have already been a fading rally. ECB and Federal Reserve decisions were both mildly dovish and so it will be for the markets to decide the next move. Against the Thai Baht, the Euro fell slightly from 36.85 to 36.62.