Dollar and Japanese yen end broadly higher on safe-haven buying

Market Review - 18/06/2020 00:00GMT  

Dollar and Japanese yen end broadly higher on safe-haven buying

The greenback pared intra-day losses made in Asia and European morning and ended the day higher against its major peers in New York along with the Japanese yen on Wednesday on safe-haven buying due to fear over second wave of coronavirus pandemic as number of new infections rose in the United States as well as Beijing, China.  
  
Versus the Japanese yen, although dollar retreated from 107.43 in Australia to 107.18 shortly after Asian open on active safe-haven jpy buying due to increase in coronavirus infections as well as geopolitical tensions between China/India and N. Korea/S. Korea, price recovered to 107.44 in European morning on rebound in U.S. Treasury yields and rise in U.S. stocks futures but only to drop to 106.96 in New York due to cross-buying in jpy and then moved sideways.  
  
Reuters reported China said on Wednesday it does not want to see any more clashes on the border with India following a clash on Monday that killed at least 20 Indian soldiers, adding that both countries are trying to resolve the situation via dialogue.   
  
Although the single currency rose from 1.1254 in Australia to session highs at 1.1294 in European morning on cross-buying in euro, price erased intra-day gains and fell to 1.1226 on safe-haven usd buying due to unexpected rise in coronavirus infections. The pair then ratcheted lower to a 12-day low of 1.1208 in New York and traded at 1.1246 near the close.  
  
Reuters reported Eurostat said consumer prices in the 19 countries sharing the euro fell by 0.1% month-on-month for a 0.1% year-on-year rise -- as expected in a Reuters poll of economists -- a deceleration from 0.3% year-on-year in April and 0.7% in March.   
  
The British pound went through a roller-coaster ride. Although cable initially fell from 1.2586 in Australia to 1.2541 in Asian morning, price rose to session highs of 1.2588 in European morning before falling to 1.2524 on soft UK inflation data. The pair then rebounded again to 1.2583 due to cross-buying in sterling, especially versus euro but only to an intra-day low of 1.2512 in New York on Brexit concerns and then moved broadly sideways.  
  
Reuters reported consumer price inflation slowed to 0.5% from April's 0.8%, the Office for National Statistics said, in line with the average forecast in a Reuters poll of economists.   Core inflation - which excludes typically volatile energy, food, alcohol and tobacco prices - showed less of a decline, falling to 1.2% from April's 1.4%. Economists had forecast a small drop to 1.3%.     And the European Union will do its best to seal an agreement on new ties with Britain by the end of the year but will not compromise its values to achieve that, the bloc's chief executive, Ursula von der Leyen, said on Wednesday.   
  
Data to be released on Thursday :  
  
New Zealand GDP, Australia employment change, unemployment rate, Swiss trade balance, exports, imports, SNB interest rate decision, Italy trade balance, UK BOE interest rate decision, asset purchase program, BOE QE total, BOE QE corporate bond purchases, BOE MPC vote hike, BOE MPC vote unchanged, BOE MPC vote cut, U.S. initial jobless claims, continued jobless claims, Philadelphia Fed manufacturing index, leading index change, and Canada ADP employment change, new housing price index, wholesale trade.