February 22, 2024

Forex Now: Dollar Retains Its Footing, Markets Brace Up For Yet Another Wave Of Rush To Safety

On Tuesday, January 25, here is everything you need to know:

Safe-haven movements continue to control the money systems in the face of growing geopolitical hostilities and fresh fears about a global economic downturn.

On Monday, the US Dollar Index rose above 96.00 for the first time in two weeks before dropping somewhat in the late American session.

Despite the fact that the S&P 500 Index ended the day in the black due to dip-buying, US stock futures indices were down between 0.75% and 1.25% early Tuesday.

Major Market Movers

Germany’s IFO survey and the US’s CB Consumer Sentiment data will be scrutinized for further momentum. Still, risk perception is expected to remain the dominant market driver advance of Wednesday’s Federal open market committee.

Per the latest estimates, Russia has moved over 100,000 troops, along with heavy armament, to the Ukrainian border, and markets are growing increasingly fearful of an invasion.

In response, the White House declared that over 8,000 troops have been placed on high alert and are prepared to deploy.

Meanwhile, China’s Commerce Ministry stated Tuesday that the country would face a “grim” international trade environment in 2022, blaming inflation, supply chain challenges, and a lack of momentum in the global economic recovery.

Currency Pairs, Commodities, And Crypto

ON MONDAY, the USD/RUB increased by more than 2%, reaching 79.5, its highest level since November 2020.

Russia’s central bank ordered a halt to foreign exchange purchases on the domestic market, aiding the pair in staging a correction. USD/RUB recently traded at 78.60, registering minor daily losses.

EUR/USD is under mild bearish pressure following Monday’s downbeat close and trades within striking distance of 1.1300.

GBP/USD dropped to the lowest in three weeks on Monday, 1.3439, but recovered a tiny amount of its losses. On Tuesday morning, the pair appeared to have entered a consolidation period beneath 1.3500.

The USD/JPY dipped below 113.50 but quickly reversed course, with Wall Street’s major indexes surging significantly ahead of Monday’s closing bell. Nonetheless, the pair’s rebound appears to have stalled at 114.00.

Gold climbed 0.5% on Monday, benefiting from decreasing US Treasury bond rates. XAU/USD is trading very quietly at $1,840 on Tuesday morning.

The AUD/USD pair pushed up around 0.7200 on Australian data showing that the Consumer Price Index increased by 3.5% on a year-over-year basis in the fourth quarter, up from 3% in the third quarter.

However, the risk-averse market climate pulled the duo south. The AUD/USD pair last traded at 0.7135, registering minor daily losses.

Bitcoin made a strong recovery but lost its positive momentum after surpassing $40,000. In the early European session, BTC/USD is down 2.5%, trading at just around $36,000.

Despite a late rally, Ethereum ended the day in the negative on Monday and has continued to fall, approaching the important $2,000 level.

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