US dollar soars on Ukraine invasion

Nervous investors snap up US dollars

The US dollar has moved sharply higher in Asia as investors pile into US treasuries and park their funds in a defensive US dollar position. The dollar index has risen another 0.30% to 96.50. Unsurprisingly, the euro has borne the brunt of the selling, EUR/USD falling 0.50% to 1.1250. GBP/USD has fallen to 1.3525. Key risk sentiment indicators, the Australian and New Zealand dollars, are 0.70% lower.

Asian currencies have also fallen, and the impending inflationary shock will impact Asia more than most as huge net energy importers. The INR, THB, KRW, SGD, PHP, and INR are 0.50% lower with the MYR down just 0.25%. Unsurprisingly, USD/CNY is almost unchanged.

Like equity markets, it is hard to find any reasons for the selloff to reverse now that it appears the tanks are rolling. Stronger sanctions are to come on Russia and energy prices will inevitably head higher in the short term. Only the Swiss franc and the Japanese yen are likely to hold their own as fellow haven currencies.

This article 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 Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Jeffrey Halley

Jeffrey Halley

Senior Market Analyst, Asia Pacific
With more than 30 years of FX experience – from spot/margin trading and NDFs through to currency options and futures – Jeffrey Halley is 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, Channel News Asia as well as in leading print publications including 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

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