Dollar finished last week on the back foot, reacting to Fed's decision to cut rates by 50 bps. While the greenback lost ground to most major rivals, its decline was relatively modest. Notably, Dollar managed to close higher against both Japanese Yen and Swiss Franc, and it continued to hold above key near term support level versus Euro. US stock market's rally to fresh record highs lacked its usual exuberance, with market sentiment appearing somewhat half-hearted. This tempered risk-on mood, coupled with rebound in US treasury yields, helped mitigate more substantial selling pressure on Dollar. Weakness in Japanese Yen was much more pronounced, primarily due to the cautious tone struck by BoJ, which signaled that it's not in a rush to raise interest rates again in the near term. This stance weighed heavily on Yen, which had already been under pressure from surging bond yields in the US and Europe. Technically, Yen's short-term rebound seems to have well concluded, and the currency is now embarking on a fresh decline. Sterling, on the other hand, stood out as one of the top performers, supported by a combination of strong UK economic data and more hawkish-than-expected outcome from BoE. The Pound broke key resistance levels against both Euro and Swiss Franc, solidifying its position as one of the top gainers, with more upside potential ahead. For the week overall, Yen was the clear laggard, followed by Swiss Franc and Dollar. On the flip side, Australian Dollar emerged as the best performer, while Sterling was a close second. New Zealand Dollar also performed well, rounding out the top three. The Euro and Canadian Dollar ended the week more neutrally, positioning themselves in the middle of the pack.... |
