Yen and Aussie
The Japanese Yen and the Australian Dollar performed excellently against the majors as the Coronavirus pandemic continues to affect the global economy.
JPY Outperforms Again
While the Yen and Aussie lead the market charge, the Yen was the best performing currency of the week. The Japanese Yen outperformed every other major currency for the second week running. The worrisome coronavirus and global economic headlines were the significant drivers behind the JPY’s strength this week. The Yen performed excellently despite the calls of national emergency in Japan and subsequent weak economic data in the country. Their industrial production was revised down from +0.4% to -0.3% in February.
Against the Euro, the Yen went up by 1.46% to end the week trading at 116.93. Yen’s next biggest win was against the New Zealand Dollar, rising by 1.45% by the end of the week. Against the U.S Dollar, the Yen went up by nearly 1%, ending the week at 107.56. The Yen also recorded gains against the British Pounds (1.21%), the Canadian Dollar (1.01%), the Swiss Franc (0.62%), and the Aussie (0.59%.
The second best-performing currency of the week is the Aussie, which recorded gains against all the other major currencies except the U.S Dollar and, of course, the Japanese Yen. The strong performance from the Aussie came despite the historically weak Australian sentiment data. However, the positive employment data from Australia helped pushed the AUD above most of the other major currencies. Australia added 5.9k jobs in March despite predictions of a 33k drop in unemployment numbers. This means the unemployment rate was 5.1%, instead of the 5.4% expected by analysts. Their MI inflation expectations also went up from 4.0% to 4.1%.
The biggest win for the Aussie was against the Euro, where it was up by 0.69% last week. Thus, the AUD/EUR trading pair ended the week at 0.59. The Aussie was also up by 0.64% against the New Zealand Dollar and up 0.48% and 0.40% against the Canadian Dollar and the Swiss Franc, respectively.
Greenback Could Rally Next Week
The greenback could perform excellently over the coming week as the Federal Reserve is set to slow bond purchases. Investors will still be paying attention to the Federal Reserve’s stimulus efforts and the strategies outlined for ending the COVID-19-induced lockdown.
The Federal Reserve will also be halving its treasuries purchase, from $30 billion to $15 billion per day. This may serve as an excellent catalyst for U.S. Dollar growth, especially if other major central banks around the world continue stretching their accommodative monetary policy stances to ward off the economic consequences of the pandemic.
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