The dollar had its biggest monthly gain against a basket of peers since May as a global selloff of emerging-market currencies prompted investors to seek the relative safety of haven assets.
The yen gained versus the dollar for the first time in six months as the global rout spurred investors to reverse carry trades. The Argentine peso and Hungary’s forint were January’s two biggest emerging-market losers. The greenback climbed versus all 31 major peers except the yen as the Federal Reserve scaled back monthly bond purchases a second time, citing labor-market improvements. U.S. payrolls gains more than doubled last month, according to a Bloomberg survey before next week’s report.
“The dollar has benefited from the broad-based flight out of risk assets and into safer ones,” Omer Esiner, chief market analyst in Washington at the currency brokerage Commonwealth Foreign Exchange Inc., said yesterday in a phone interview. “That we didn’t really get even an acknowledgment of the selloff in emerging markets by the Fed shows that it sees little risk of contagion at this point, which is also dollar-positive.”
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 email@example.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.