Dollar, yen retreat as risk sentiment revives

South Korean won, Chinese yuan, and Japanese yen notes are seen on US 100 dollar notes in this illustration in Seoul, South Korea, Dec. 15, 2015. REUTERS / Kim Hong-Ji

TOKYO, Jul 22 (Reuters) – The Safe Harbor US dollar and yen remained in retreat Thursday after retreating from multi-month highs amid a rebound in risk appetite as strong gains boosted Wall Street stocks.

Cryptocurrencies rebounded after Elon Musk, CEO of Tesla Inc (TSLA.O), said the company would “most likely” be accepting bitcoins for payment again. Continue reading

The dollar index, which measures the currency against six major competitors, stood at 92.810 after pulling back from a 3 1/2 month high of 93.194 on Wednesday.

The yen traded at 130.045 per euro, from a nearly four-month high of 128.610 earlier this week, and at 81.00 against the Australian dollar, from a 5 1/2 month high of 79.85.

“Strong profits have swept away Delta concerns in the US,” National Australia Bank analyst Tapas Strickland wrote in a statement to customers.

“The consensus is that (the Delta strain) is not an immediate risk to recovery,” he said, that reopening will be delayed for a maximum of three months as countries start vaccination campaigns in response.

The pound sterling was trading at $ 1.3708, rebounding from a 5 1/2 month low of $ 1.35725 hit Tuesday, despite rising cases of delta variants in the UK and confusion over the lifting of restrictions in England .

The Aussie changed hands at $ 0.7350, from an eight-month low of $ 0.72895 the previous day, despite half of the Australian population being under lockdown.

The euro stood at $ 1.1789, rising from Wednesday’s 3-1 / 2-month low of $ 1.1752 ahead of a closely watched policy decision by the European Central Bank later on World Day.

Politicians will change their strategy for the first time and will almost certainly promise an even longer period of impetus to keep their promise to increase inflation.

Analysts generally see the reluctance of the ECB to weaken the euro in the medium term.

“All in all, the ECB’s new inflation target suggests that monetary policy will remain extremely accommodative for much longer,” which will counter the euro, Commonwealth Bank of Australia strategists Kim Mundy and Carol Kong write in a study Note.

“We expect the ECB to be one of the last central banks to come under our supervision to tighten policy.”

In cryptocurrencies, Bitcoin held the 7.9% surge on Wednesday – the largest since mid-June – trading around $ 32,200.

Rival Ether traded just below $ 2,000 after rising 12%.

Reporting by Kevin Buckland; Adaptation by Sam Holmes

Our Standards: The Thomson Reuters Trust Principles.


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