The dollar gained against all but one of its major peers, even in the midst of a risk-on environment, with risk appetite perhaps boosted by optimistic remarks over a US-China trade deal, as well as news that US lawmakers reached a deal in order to avert another government shutdown. Tonight, the RBNZ decides on monetary policy, and while no change in rates is expected, we believe that Governor Orr will keep the prospect of a cut well on the table. We also see a decent chance for policymakers to push back the timing of when they expect rates to rise.
Dollar Keeps Gaining Even Amid a Risk-on Environment
The dollar traded higher against all but one of the other G10 currencies. It gained the most against NOK, JPY and GBP in that order, while the currency that managed to resist the greenback’s strength was CAD, with USD/CAD trading virtually unchanged.
Although not clear by the performance in the FX world, Monday was a risk-on day and this is evident in the equity sphere. All major EU indices closed their sessions in positive territory, and although US markets traded on a somewhat softer note, shares in Asia also...
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