The Dollar Is Flat as The Outlook for Growth Dims
The dollar showed little movement on Wednesday. The Chinese yuan strengthened simultaneously as the authorities relaxed some of the nation’s zero-COVID regulations.
Leading bankers from JPMorgan, Bank of America, and Goldman Sachs stated overnight that they are preparing for an economy that will deteriorate next year due to inflation and high-interest rates.
Following a 0.16% gain on Tuesday, the US dollar was up 0.32% against the Japanese yen. Despite this, the euro was unchanged against the dollar at $1.048 after falling 0.2% the previous session.
Investors are considering the outlook for the US dollar. Some investors think the recent decline is excessive and that the currency should appreciate, given worries about the global economy and future Fed rate increases. At 105.55, the US dollar index had increased 0.1% against a basket of currencies.
In Asia, the Chinese yuan strengthened after the government announced measures that marked a significant shift away from its harsh, three-year-old zero-COVID policy, which has battered the country’s economy and sparked historic protests.
The declaration was the most convincing proof that China was preparing its citizens to deal with the disease. However, analysts warn that the road to fully reopening the economy will be long, bumpy, and dangerous. However, investors were also digesting dismal data showing that China’s exports and imports fell at the fastest rate in at least two and a half years in November. The British pound rose 0.13% to $1.215 per dollar.
The Australian dollar was roughly flat at $0.6689 after data showed the country’s economy slowed slightly in the September quarter, a day after the central bank signaled more rate hikes to cool inflation. The New Zealand dollar gained 0.33% to $0.6339.
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