The FOREX-Dollar reaches its highest level in a year; The impact of the US debt ceiling is mitigated


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* The dollar rises against the yen to the highest since February 2020 * The euro falls to the lowest since late July 2020 * The US government shutdown looms as the debt ceiling deadlock is not resolved * Global Central Bankers Monitor Inflation (Add New Commentary, Central Bankers Comments, Latest Debt Ceiling Negotiations, Price Update) By Gertrude Chavez-Dreyfuss NEW YORK, Sept.29 (Reuters) – The dollar surged to a one-year high against major currencies on Wednesday, boosted by heightened expectations of a reduction in US Federal Reserve asset purchases from November and higher interest rates, perhaps at the end of 2022. The greenback has also performed well despite a deadlock in Washington on the US debt ceiling which threatened to plunge the government into a shutdown. The world’s largest reserve currency, seen as a safe haven in times of market stress, has strengthened in recent days as investors focus instead on fears of a global slowdown, rising prices energy and higher US Treasury yields. Traders are also concerned that the Fed may start to withdraw political support just as global growth slows. “The Fed has signaled the start of the normalization of monetary policy,” wrote Kit Juckes, macro-strategist at Societe Generale in his latest research note. “As the United States escapes the zero interest rate, leaving the eurozone and Japan behind, the global savings glut is likely to be drawn to the dollar, which may outperform most other currencies over time. year to come, and could start its movement earlier than expected, ”he added. The dollar index – which measures the US currency against a basket of six major currencies – rose for the fourth day in a row, to 94.112, its highest since early November last year. It was up 0.4% to 94.115. Erik Nelson, macro strategist at Wells Fargo in New York, sees a further 2-3% rise in the dollar index. The greenback was also unfazed, even as Republicans in the U.S. Senate on Tuesday blocked an offer by Democrats under President Joe Biden to avoid a potentially crippling U.S. credit default, with federal funding set to expire on Thursday and borrowing power towards the bank. October 18. The Senate could vote Wednesday or Thursday on a bipartisan resolution to fund federal operations until early December, Senate Democratic Leader Chuck Schumer said. The euro was one of the currencies to lose ground, falling below the level of $ 1.16, the lowest since the end of July 2020. It traded for the last time down 0.7% at $ 1.1596. The yen reacted little to the election of Fumio Kishida as head of the ruling Liberal Democratic Party in Japan, which saw him become the country’s next prime minister. The yen, the currency most sensitive to US yields because higher rates can attract inflows from Japan, hit an 18-month low against a resurgent dollar. The dollar climbed to 112.04, its highest level since late February last year, and rose 0.4% to 111.99 yen. Currency traders also took note of comments from leading central bankers on Wednesday, who were panelists at a European Central Bank forum in Sintra, Portugal. Fed Chairman Jerome Powell, European Central Bank President Christine Lagarde and Bank of England Governor Andrew Bailey have said they are keeping a close watch on inflation amid soaring prices of the energy and persistent production bottlenecks. =================================================== ====== Currency Bid Price at 3:29 PM (1929 GMT) Description RIC Last US Close YTD Percent Change YTD Higher Bid Price Lower Bid Previous Change Session Dollar Index 94.3810 93.7060 + 0.73% 4.890% +94.4350 +93.6710 Euro / Dollar $ 1.1594 $ 1.1684 -0.76% -5.10% + $ 1.1690 + $ 1.1590 Dollar / Yen 111.9950 111.5150 + 0.43% + 8.40% +112.0450 +111.2100 Euro / yen 129.85 130.25 -0.31% + 2.31% +130.4700 +129.6800 Dollar / Switzerland 0.9348 0.9293 + 0.59% + 5.66% + 0.9355 + 0.9281 Sterling / Dollar $ 1.3426 $ 1.3536 -0.81% -1.72% +1.3554 $ + 1.3412 Dollar / Canadian 1.2754 1.2686 + 0.54% + 0.16% +1.2774 + 1.2670 Aussie / Dollar $ 0.7181 $ 0.7240 -0.79% -6.62% + $ 0.7264 + $ 0.7173 Euro / Switzerland 1.0839 1.0855 -0.15% + 0.30% +1.0862 +1.0822 Euro / Sterling 0.8633 0.8629 + 0.05% -3.40% + 0.8658 +0.8613 NZ $ 0.6864 0.6960 -1.38% -4.41% + $ 0.6962 +0 , 6861 Dollar / Dollar Dollar / Norway 8.7680 8.6605 +1.13% + 1.99% +8.7760 +8.6460 Euro / Norway 10.1678 10.1219 + 0.45% -2.86% +10.1815 +10.0980 Dollar / Sweden 8.8072 8.7334 +0.0 6% + 7.45% +8.8112 +8.7233 Euro / Sweden 10.2116 10.2055 + 0.06% +1.34% +10.2175 +10.1816 (Report by Gertrude Chavez-Dreyfuss; Additional reporting Iain Withers in London, edited by Angus MacSwan, Kirsten Donovan, Philippa Fletcher and Jonathan Oatis)

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