Stimulus concerns stimulate the US dollar

Hopes fade over fiscal stimulus package

Currency markets remained for the most part, in a range-trading holding pattern overnight. The US dollar lost ground on stimulus hopes and upbeat US data in a non-descript session. With no US package emerging, risk aversion has risen in Asia, with the US dollar index reclaiming all of its losses from overnight, increasing 0.20% this morning to 93.90, leaving is almost dead centre of its two-week range.

That risk-off tone has been heightened by the news that US President Trump will begin a quarantine period after an aid tested positive for Covid-19 overnight. That may have implications for the election campaign and possibly the second debate, although may readers I acknowledge, would be more than happy for him to stay in quarantine. The extra element of uncertainty has seen the EUR/USD, GBP/USD, AUD/USD and NZD/USD all fall by 0.20% this morning. USD/JPY has been unmoved by Japan’s Finance Minister stating that a third extra budget is not being considered.

With the G-10 currencies all range-bound and moving on headlines, and with the major centres of North Asia, all closed for holidays, activity in regional Asian currencies is very light. The US dollar has risen 0.20% versus the SGD, MYR and THB in line with the Trump news, but otherwise, Asia seems content to wait for the Non-Farm Payroll data this evening.

What can we expect from the September Non-Farm Payrolls? The forecast stands at a rise of 850,000 jobs. It is noteworthy that the next time Non-Farm Payrolls is released, the US election will have passed. That means that today’s reading assumes a greater than usual significance, with a soft number possibly turning into a campaign issue if a stimulus deal is not reached. The same could also be said if the data outperform, with the Republicans using the numbers to show that the economy is improving under their helm. Either way, the data should ensure we have an energetic finish to the week.

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at Visit to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.

Jeffrey Halley

Jeffrey Halley

Senior Market Analyst, Asia Pacific, from 2016 to August 2022
With more than 30 years of FX experience – from spot/margin trading and NDFs through to currency options and futures – Jeffrey Halley was OANDA’s Senior Market Analyst for Asia Pacific, responsible for providing timely and relevant macro analysis covering a wide range of asset classes. He has previously worked with leading institutions such as Saxo Capital Markets, DynexCorp Currency Portfolio Management, IG, IFX, Fimat Internationale Banque, HSBC and Barclays. A highly sought-after analyst, Jeffrey has appeared on a wide range of global news channels including Bloomberg, BBC, Reuters, CNBC, MSN, Sky TV and Channel News Asia as well as in leading print publications such as The New York Times and The Wall Street Journal, among others. He was born in New Zealand and holds an MBA from the Cass Business School.
Jeffrey Halley
Jeffrey Halley

Latest posts by Jeffrey Halley (see all)