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FOREX-Dollar dips as risk appetite improves on strong earnings, stimulus hopes

Published 06/08/2020, 01:29 am
Updated 06/08/2020, 01:30 am
© Reuters.
EUR/USD
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USD/JPY
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USD/NOK
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DX
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ADP
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* U.S. dollar index near more than 2-year low

* U.S. private payrolls miss expectations in July

* Euro zone PMIs showcase growth (New throughout, updates prices, market activity, data and comments; new byline)

By Caroline Valetkevitch

NEW YORK, Aug 5 (Reuters) - The U.S. dollar slipped against basket of currencies on Wednesday as investors' appetite for risk improved on strong corporate earnings and expectations of more stimulus measures for the pandemic-ravaged global economy.

U.S. and European investors piled into stocks on Wednesday as companies in both regions posted a batch of positive earnings reports.

The dollar, a safe-haven currency, typically weakens when investors grow more comfortable holding riskier assets.

On Wednesday, the U.S. Dollar Currency Index =USD , which measures the greenback's strength against six major currencies, was 0.536% lower at 92.652, just shy of a more than two year low of 92.593 touched last week.

"Clearly we have seen risk appetite rebound on global markets and sort of a return of the theme of a U.S. underperformance relative to world counterparts," said Karl Schamotta, chief market strategist at Cambridge Global Payments in Toronto.

U.S. stocks also have grown cheaper for overseas investors as the dollar has been pressured in recent weeks by worries about the U.S. economic slide during the coronavirus pandemic. The dollar fell further on Wednesday after the ADP (NASDAQ:ADP) National Employment Report, which showed U.S. private payrolls growth slowed sharply in July, suggesting a loss of momentum in the labor market. morning's weak ADP data suggests we may see further weakness when non-farm payrolls land on Friday," he said. "That is weighing on the dollar's prospects relative to the other majors."

Euro zone business activity returned to modest growth in July as many curbs imposed to stop the spread of the coronavirus were lifted, while official estimates showed retail sales volumes rebounded in June. also are watching negotiations between the White House and congressional Democrats trying to reach a deal on a relief package by the end of this week. Treasury Secretary Steven Mnuchin said progress had been made. Australian dollar AUD=D3 , which tends to rise when risk sentiment improves, was last up 0.88% at $0.7223 against the U.S. dollar.

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Currency bid prices at 11:09AM (1509 GMT) Description

RIC

Last

U.S. Close Pct Change

YTD Pct

High Bid

Low Bid

Previous

Change

Session

Euro/Dollar

EUR=

$1.1889

$1.1800

+0.75%

+0.00%

+1.1900

+1.1794 Dollar/Yen

JPY=

105.5100

105.7000

-0.18%

-3.08%

+105.8700 +105.3300 Euro/Yen

EURJPY=

125.45

124.76

+0.55%

+0.00%

+125.4800 +124.6400 Dollar/Swiss

CHF=

0.9057

0.9132

-0.82%

+0.00%

+0.9139

+0.9054 Sterling/Dollar GBP=

1.3145

1.3060

+0.65%

-0.86%

+1.3161

+1.3059 Dollar/Canadian CAD=

1.3245

1.3317

-0.54%

+1.99%

+1.3330

+1.3233 Australian/Doll AUD=

0.7223

0.7160

+0.88%

+2.88%

+0.7241

+0.7154 ar

Euro/Swiss

EURCHF=

1.0769

1.0777

-0.07%

+0.00%

+1.0793

+1.0763 Euro/Sterling

EURGBP=

0.9043

0.9032

+0.12%

+0.00%

+0.9050

+0.9013 NZ

NZD=

0.6664

0.6622

+0.63%

+0.00%

+0.6672

+0.6619 Dollar/Dollar

Dollar/Norway

NOK=

8.9467

9.0957

-1.64%

+1.92%

+9.1056

+8.9464 Euro/Norway

EURNOK=

10.6407

10.7361

-0.89%

+0.00%

+10.7467

+10.6339 Dollar/Sweden

SEK=

8.6548

8.7179

+0.01%

+0.00%

+8.7264

+8.6497 Euro/Sweden

EURSEK=

10.2927

10.2916

+0.01%

+0.00%

+10.3035

+10.2836

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Euro near 2-year high

https://tmsnrt.rs/33uZUsO Graphic: World FX rates in 2020

https://tmsnrt.rs/2RBWI5E

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

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