The US Dollar is looking the best of a bad bunch for investors..
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| GBP v USD has lost 1.3% this week with EUR v USD down 1.4%.
Even though the US government remains in shutdown mode, it hasn't deterred investors from buying up the USD & US assets. Up until yesterday, US stocks, gold and bitcoin were all trading up too since the shutdown began.
However, with Japan, France, Germany & the UK all under the spotlight in a negative way recently, investors have moved into the safest currency haven of them all for protection; USD.
Risk sentiment turned sour yesterday after commentary on US stocks from two financial market heavyweights; Ray Dalio and Jamie Dimon. Both have warned of an impeding stock market correction and financial markets have since cooled.
Uncertainty is the perfect breeding ground for safe-haven currencies like the USD.
Switzerland/CHF offers extremely low yields and so are obviously not popular to invest in and the Euro has lost some of its earlier 2025 shine. Economic news out of Germany this week has been concerning (industrial output suffered its worth monthly drop since March 2022) and a soft Q4 is now expected.
The political issues in France will remain under scrutiny by investors and of course its all eyes on the UK Budget next month which GBP is shackled to. So it really leaves no other option but for the USD to be bought.
£-€ ends the week the same price it started which is of no surprise really. Next week we see a much busier economic calendar, especially as far as the UK is concerned. |
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