The dollar gained against all the other G10 currencies, perhaps as investors scaled back bets with regards to a 50bps rate cut by the Fed at its upcoming meeting. That said, most major global bourses closed in positive territory. This may have been due to expectations of a dovish ECB on Thursday. As for today, attention is likely to fall on the UK and the final outcome of the Conservatives leadership contest, with Boris Johnson being the clear favorite for replacing Theresa May.
USD Gains on Reduced Bets Over a “Double” Fed Cut Next Week
The dollar traded higher against all the other G10 currencies yesterday and during the Asian morning Tuesday. It gained the most against NZD, which slid after the RBNZ noted that they are looking at refreshing their unconventional policy strategy. Although this was a responce to an official information request, the idea that the RBNZ could consider QE has weighed on the currency. The dollar strengthened the least against CHF and JPY.
At first glance, the fact that the dollar gained the least against the safe havens suggests a risk-off trading environment. However, taking a look at the stock market performance, that...
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