Major global equity indices continued trading north yesterday, perhaps due to the latest optimism surrounding the US-China trade front, but also due to hopes of more easing by major central banks after the ECB announced a new stimulus package. The Bank cut its deposit rate by 10bps and announced a restart of its QE purchases. The euro tumbled on the announcement, but hit support near the low of September 3rd, and then, it rallied. This may have been due to technical buying or because some participants were expecting a larger cut and/or a larger amount of monthly asset purchases.
Investors Continue to Buy Equities on US-China Optimism
The dollar traded mixed against the other G10 currencies on Thursday and during the Asian morning Friday. It gained against NZD, NOK, CAD and AUD, while it underperformed versus EUR, SEK, CHF, and slightly against GBP. The greenback was found virtually unchanged against JPY.
By looking at the FX performance table, someone would have assumed that yesterday was a risk-off day. All commodity-linked currencies traded on the back foot, and...
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