Risk-sensitive currencies tumbled down after rallying in recent weeks. The Australian dollar declined by 0.3% to $0.6942, off Thursday’s one-month high of $0.7001.
On the other hand, the Chinese yuan, which often aligns with risk-sensitive currency groups, soared on Thursday. The yuan touched a near-four-month high of 6.9808, but in the end, it traded at 7.005 yuan per greenback in offshore trading, lower by about 0.1%.
The euro fell by 0.1% to $1.1273, plummeting down back from a one-month high of $1.1371. According to Minori Uchida, the chief currency strategist at MUFG Bank, although there were improvements in economic data, people started to think that this is just a natural outcome of an economic reopening. Presently, they are beginning to worry more about increasing Covid-19 infections.
Thursday’s weekly data showed that the number of Americans filing for initial jobless benefits collapsed to a near four-month low last week. Meanwhile, the outlook remained highly uncertain, with companies from retailers to airlines announcing job cuts and furloughs.
Safe-haven currencies surged forward after virus cases rose
On Friday, the U.S. dollar and other safe-havens rallied against riskier currencies as a rise in coronavirus infections in the United States further undermined the hopes for a quick recovery in the economy.
There were more than 60,000 new Covid-19 cases across the United States in the latest count. Thus far, that’s the greatest single-day tally by any country in the pandemic. It discouraged some U.S. consumers from returning to public spaces.
However, the dollar index rose by about 0.1% in Asia due to traders’ caution. It climbed up to 96.863 from the near one-month low of 96.233 touched on Thursday.
The safe-haven Japanese yen also hit a two-week high against the dollar, soaring to 107.00 per dollar. And the Swiss franc stayed near its highest level in six weeks against the euro, at 1.0619 francs per euro. The franc changed hands at 0.9419 per dollar versus the greenback after having hit a four-month high of 0.93625 to the dollar.
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