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By xemarketanalysis December 5, 2018 2:27 pm
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    Xe Market Analysis: Dollar settles as fears of Recession Ease

    OVERVIEW

    • US Dollar steadied after a possible inversion in the Treasury Yield curve
    • The Pound trades well off its lows as Brexit outlook turns more positive
    • Canadian dollar hits an 18-month low as rate hike chances are slashed 

    HIGHLIGHT

    The Loonie hit an 18-month low today as a rate hike was put on the back burner by the Bank of Canada. This announcement weakened the currency against the Greenback posting a high of near the 1.34 handle.

    USD CAD 12_5_2018

    US DOLLAR

    The Dollar has recovered from its recent lows somewhat. The weakness has come on the back of 2-year and 10-year treasury bond yield curves running the risk of inverting. After declaring a temporary truce with China on trade tariffs following the G20 Summit, the Greenback recovered as worries over economic growth abated.

    BRITISH POUND

    The Pound has stemmed some of its early losses this week. It was suggested that Britain may not actually opt to leave if the meaningful vote goes against PM May. This reduced some recent uncertainty. However, if this is ruled out in the coming days we expected GBP to weaken once again.

    EURO

    Content about EUR goes hereThe Euro is widely stronger today after the EU expressed intentions to broaden the global use of its currency. The EU is looking to rival the US Dollar as the world's reserve currency and ultimately try to challenge the Greenback's dominance.

    CANADIAN DOLLAR

    The Canadian Dollar is considerably weaker today as the Bank of Canada left rates on hold. Losing as much as 1% against the American Dollar at its lows the possibility of further rate hikes was slashed by investors.   

    AUSTRALIAN DOLLAR

    The Australian dollar tailed off today as disappointing data dented chances of further rate hikes. The Australian economy only grew 0.3% in the third quarter against forecasts of double that declared number. Downward revisions to previous readings also hurt the currency as it fell by just under 1%.

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