Even though the minutes from the latest Fed meeting indicate that some in the FOMC are concerned about what’s next, and how to deal with a stronger dollar during a global economic slowdown, the greenback is heading higher today. Risk aversion is high, and that is reflected in today’s gains by the dollar.
Low beta currencies like the US dollar are gaining ground today as risk aversion floods the market. Stocks took a big hit yesterday, and US stock futures indicate that it’s going to be another down day for the markets.
With all of this uncertainty, it’s no real surprise that the US dollar is gaining the upper hand against most of its major counterparts, and that the US dollar index is surging today. Even after the release of the FOMC minutes — which show a great deal of hand-wringing over the situation of a global slowdown plus a strong dollar — the greenback is heading higher.
There’s just no other currency that can compare at this point.
At 10:51 GMT the US dollar index is up to 85.7000 from the open at 85.5340. EUR/USD is down to 1.2671 from the open at 1.2691. GBP/USD is down to 1.6051 from the open at 1.6118. USD/JPY is down to 107.7720 from the open at 107.8400.
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