Dollar, Yen, Loan Prime Rate, and Bank of China in Market

Dollar, Yen, Loan Prime Rate, and Bank of China in Market

Against the Japanese yen, the dollar last traded a tad stronger at 109.31. Against the Euro, the dollar is a tiny bit weaker at $1.1116. This week’s dollar has gained 0.7% on the yen.

The last 24 hours’ best performer was the Australian dollar. The Australian dollar rallied half a percent because stable jobs data prompted traders to pare back bets on a cut of interest rate when the central bank meets in February.

Forecasts that the Australian Reserve Bank will reduce rates fell from about 60% to just under even.

Sean Callow, Westpac FX analyst, said that it is a notable change. When the expectations fall under 50%, the psychology changes a little bit also. People are not entirely convinced, added Callow, who is sticking with a forecast for a cut.

The Australian dollar was the last steady near a one-week high at $0.6883. In a week where another round of positive economic data offset weakness in milk prices, the New Zealand dollar was stable at $0.6607.

Dollar and Others

Dollar

China is unveiling of new tariff exemptions on U.S. oil and chemical product imports. It supports optimism about the China-U.S. trade détente. The Chinese yuan held just on the better side of the symbolic 7-per-dollar.

Markets widely expect further monetary cuts in 2020 to fight an economic slowdown. On Friday, China kept its lending benchmark unchanged.

The five-year LPR (loan prime rate) also remained the same at 4.80%. From the previous monthly fixing, the one-year loan top rate was unchanged at 4.15%.

The People’s Bank of China lowered rates on 14-day reverse repurchase agreements to ease monetary conditions on Wednesday.

The index of the dollar rose slightly 97.440. Robust housings and firmer-than-expected manufacturing data start this week to halt two weeks of declines against the basket of currencies. In most of the places, the dollar found strong support.

There is a very little probability from the U.S. Fed to move interest rates anywhere when it meets in January.

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