Although the dollar did not attract any safe-haven flows, risk sentiment continued to deteriorate on Monday amid increased concerns over global economic growth. Major EU and US indices were a sea of red, with the negative sentiment rolling into the Asian session Tuesday. As for the dollar, it may have slid on profit taking ahead of tomorrow’s FOMC decision. Once again, the RBA minutes were a non-event for Aussie traders, who may keep their gaze locked on changes in the broader market sentiment.
Risk Appetite Continues to Fade Amid Global Growth Worries
The dollar traded lower against most of the other G10 currencies on Monday. It outperformed only NOK and CAD, which may have come under pressure due to the slide in oil prices. The main gainers against the greenback were NZD, JPY and CHF in that order, with NZD rallying after New Zealand’s ANZ business confidence index for December rose to -24.1 from -37.1 in November. This means that only a net 24.1% of companies expect business conditions to deteriorate in the coming 12 months compared to 37.1% previously.
Although the dollar traded on the back foot on Monday, the performance of the equity markets suggests that...
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