ACY Securities

The Euro (EUR/USD) tumbled 0.8% lower to 1.0887 (1.0975) weighed by a soft Eurozone Inflation report. The Dollar Index (DXY), which measures the value of the Greenback against a basket of 6 major currencies rebounded to 103.55 from 102.80.

In the unfolding narrative of today's Asian trading session, the US dollar found itself grappling with yet another catalyst for a downturn, this time spurred by an unexpectedly hawkish monetary policy pronouncement from the Reserve Bank of New Zealand (RBNZ).

The value of the United States dollar has experienced a significant decline, with the DXY index nearing a 4% drop on a month-to-date basis. If this trend persists, it could mark the most substantial monthly decrease in the dollar's performance since November of the previous year.

The overnight trading session unfolded with a notable lack of volatility. Noteworthy shifts were observed among G10 currencies, with particular attention drawn to the Australian dollar and the yen, as the US dollar remained in a weakened position.

In the current market scenario, equities exhibit a mixed performance, characterized by narrow ranges, while the foreign exchange (FX) market experiences a temporary stall as participants eagerly await additional data.

The Kiwi (NZD/USD) found its wings, soaring 0.55% against the Dollar ahead of today’s RBNZ rate decision. New Zealand’s Reserve Bank is expected to keep its Official Cash Rate at 5.5%.

At the commencement of this week, the US dollar has displayed continued weakening, particularly evident in its depreciation against the yen overnight. This sets the dollar index on a trajectory to register its initial monthly decline since July.

The Bank of Japan (BoJ) continues to adhere to its stance that private consumption has exhibited a steadfast, moderate pace of growth, even in the face of challenges posed by ascending price levels.

The eurozone PMIs bounced back a bit in November but still signalled contraction. The composite employment index dipped below 50 for the first time since the pandemic.

The Dollar Index extended its drop to 103.40 (103.75) in thin holiday trade. The Canadian Loonie outperformed. The USD/CAD pair slid 0.7% to 1.3615, just over one-month lows from 1.3640 in the previous session.

New York markets closed early in preparation for the long US Thanksgiving weekend. The Australian Dollar (AUD/USD) jumped to 0.6562 (0.6542) after RBA Governor Michelle Bullock mentioned that policy tightening was the appropriate response to demand driven inflation.

The UK PMIs recovered a little in November, which chimes with recent rises in payrolls and house prices. But some of the price indices showed a small rebound in inflation too.