Kevin Buckland

TOKYO, Reuters – Friday’s safe-haven dollars hovered just below a 1-year high against major peers. This was due to improved risk sentiment. Meanwhile traders waited for clues from closely monitored monthly payrolls reports on Federal Reserve policy normalization.

After hitting a three-week peak overnight, the risk-sensitive Australian currency held at 0.55% against its greenback.

After U.S. Senate leaders acted to avoid a U.S. default on its debt, global equities rose and bond yields climbed while a global easing of energy prices tempered simmering stagflation worries.

Rodrigo Catril from National Australia Bank (OTC) wrote to clients that the “improvement in risk appetite favors favorable currencies with safe-haven pair underperformers,” in an FX strategy note.

Catril indicated that while the “decent attempt” at breaking higher has been made, but it will have to show Catril that it can maintain $0.7315 after several unsuccessful attempts.

The Australian currency was nearly flat at $0.73105 on Thursday. However, it rose to $0.7324 for its first time since Sept. 16.

U.S. Dollar Currency Index measures the greenback against six peer currencies. After trading in tight ranges on Thursday, it was at 94.202. This is within striking distance of last week’s high of 94.504 which has been unsurpassed since late September 2020.

The dollar gained 0.6% to 111.6 yen. This is in line with the trend toward the higher end of the trading range over the last week and half.

After falling to $1.1529 on Wednesday, the euro settled around $1.1555.

As the U.S. central banks move away from crisis-driven policies, it has indicated that they will likely reduce their monthly bond purchases starting in November.

The Friday non-farm payrolls data will show an expected improvement in the labor market. A Reuters poll indicated that 500,000 new jobs are forecasted for September.

Sterling gained 0.26% over the overnight period to trade at $1.3617.

Huw Pill, new Bank of England Chief Economic Economist, commented that inflation pressures had been more persistent than first thought. These comments reinforced the expectation of a rate rise by February or possibly this year.

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Prices for currency bids at 0037 GMT

Description: RIC U.S. Last Close Pct. Change YTD High Bid Low

Previous changes

Session

Euro/Dollar

$1.1556 1.0054 +0.01%.-5.43%.+1.1560.+1.1551

Dollar/Yen

111.7200 11.6150 +0.00%+8.06% +111.7200 +0.0000

Euro/Yen

129.10 128.95 +10.22% +1.72% +129.1100

Dollar/Swiss

0.9290/0.9290 -0.01% +15.00% +0.9291+0.9288

Sterling/Dollar

1.3613 1.3615 +0.01%-0.33%+1.3622+1.3617

Dollar/Canadian

1.2555 1.2554 +0.01%-1.41%+1.2562+1.2547

Aussie/Dollar

0.7312 0.7313 = 0.01% –4.94% +0.7319 >0.7307

NZ

Dollar/Dollar 0.6931 0.6931 +0.01% -3.47% +0.6937 +0.6930

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