THE dollar advanced 1.54% to 93.35, near a two-month high as the risk sentiment dents ahead of the November US elections as well as a continued increase in Covid-19 infections.
This week’s Fed speeches have also acted against the mood in markets as officials reiterated the path that US economic recovery remains uncertain, signalling a wait-and-see approach when it comes to further monetary stimulus, while pointing out that Congress needs to focus more on the fiscal policy.
Nevertheless, data release for the week was rather mixed with: September Markit Services flash PMI slowing to 54.6 from 55.0 in August (cons: 54.7); September Markit Manufacturing flash PMI expanding to 53.5 from 53.1 in August (cons: 53.1); and initial jobless claims rising to 870,000 as of Sept 19 from 866,000 in the week prior (cons: 840,000).
Brent crude declined by 2.8% to US$41.94 per barrel. The drag in price was due to the rising coronavirus cases, stoking worries about global demand; and a potential return of Libyan production which bolstered oversupply fears. Crude oil inventories for the week ended Sept 18 shrank by 1.64 million barrels, despite being relatively smaller than -4.39 million barrels in the previous week (cons: -2.33 million).The euro took a nosedive, falling 1.42% to 1.17 to a two-month low following rising concerns of coronavirus cases across the Europe.
