European Forex news roundup: Risk trades recover
Forex market news from the European trade session on September 21, 2021
Fears over Evergrande and China have faded – at least for the time being – as risk trades rebounded on the day, recouping some of yesterday’s losses.
The dollar and yen are the laggards as commodity currencies surge higher, boosted by a rebound in equities.
European indices are up more than 1% on the day, slowly moving higher, while US futures are also up slightly ahead of the cash open later.
The EUR/USD was stalled around 1.1725 early on, but is now trading at highs around 1.1740-45 as the dollar remains on the back foot today.
USD/JPY was higher initially as well, around 109.60, but is now seen tracking back to 109.35 as we look ahead to North American activity. 10-year Treasury rates were substantially higher earlier in the afternoon, about 1.34 % , but have since fallen modestly in a tumultuous session.
The loonie is the best performer, with USD/CAD trading below 1.2800 and hovering around 1.2740-50 for the time being. In European trade, the AUD/USD also maintained a strong rise, staying around 0.7260-70 levels for the most part.
As much as the market dismisses Evergrande concerns as being unrelated to the Lehman Brothers collapse, it is worth remembering that there are many moving components in China right now, and Evergrande is only one of them.
The shift in paradigm in China may merit more attention, given that Evergrande worries not stroking contagion threats, but rather risks of a drop in equities after having maintained such lofty levels for quite some time.
But, for the time being, dip buyers are doing what they do best. For the time being, ignorance is bliss.
Markets News :
- CAD leads, USD lags on the day
- European equities higher; S&P 500 futures up 0.7%
- US 10-year yields up 1.5 bps to 1.324%
- Gold up 0.1% to $1,766.19
- WTI up 1.2% to $71.16
- Bitcoin flat at $43,531