Will the dollar wobble today?By Arnaud Masset
So far, the sell-off in equities has not much affected currencies. As US stocks plunged, the dollar actually climbed 1.6% on the week, and it would have been more, had the greenback not been contained by appreciation of the Japanese yen. However, both the Swiss franc and the yen reversed momentum Friday, down 0.35% and 0.45% against the USD.
Today will be key: a renewed sell-off in equities could trigger panic. Investors are always reluctant to load risk ahead of a weekend. This could translate into buying of yen and francs. Not helping the matter is the US federal government shutdown, which so far has not seemed to fuss investors. They remain confident a solution will be found on Friday.