The euro whipsawed during Friday’s session. It soared by 1% to $1.1917 after ECB President Christine Lagarde stated that the bank does not target the exchange rate. However, the currency plummeted down to around $1.1830 soon as a U.S. equities’ fall boosted the greenback.
The British Pound traded at $1.2812 after dropping to a six-week low of $1.2773. Overall, the Sterling lost 3.5% versus the dollar last week. It lowered against the euro by roughly the same amount to sit at 92.32 pence.
Meanwhile, the dollar slightly declined against a basket of currencies in Asian trade. Despite that, it has rebounded by almost 1.7% from a 28-month low record hit early in September. According to ANZ analysts, the dollar looks delicately poised after lifting from recent lows.
On Friday, traders stuck to safer assets due to jitters in equity markets. However, the greenback seemed ready for its first back-to-back weekly gains since May.
Investors worried by a turbulent week contemplate risks ranging from next week’s Fed meeting to U.S. politics and Brexit – stated Rodrigo Catril, National Australia Bank senior currency strategist in Sydney. He also added that it’s not easy to see the equity market continue to perform in this uncertain environment.
Presently, markets are looking out for U.S. consumer price data for an insight into the recovery. While a period of volatility seems more likely, the dollar tends to find support or at least struggles to weaken in that scenario.
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How did the Japanese Yen and the riskier currencies fare?
The Japanese currency remained steady at 106.14 per dollar on Friday. Pension fund flows out of Japan had offset a safety bid as U.S. stocks plummeted down – noted Goldman Sachs analysts.
Meanwhile, the Australian dollar surged forward by 0.3%, finishing the session at $0.7275. The New Zealand dollar climbed up by 0.1% to $0.6660 as well.
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