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(New York=Yonhap Infomax) Jin Woo Choi – The US dollar strengthened for the first time in four trading days.
The greenback gained as concerns over the US government shutdown eased, reducing economic uncertainty and supporting the dollar. However, the magnitude of the rise was limited.
The Japanese yen weakened against the dollar amid mounting worries over Japan’s aggressive fiscal policy stance.
According to Yonhap Infomax (screen number 6411), as of 16:00 Eastern Time on the 10th, the dollar-yen exchange rate stood at 154.030 yen, up 0.600 yen (0.391%) from the previous New York close of 153.430 yen.
Japanese Prime Minister Sanae Takaichi told parliament, “We will maintain sustainable public finances to secure market confidence,” but added, “However, without increased investment, the economy cannot grow.”
This signaled a prioritization of economic stimulus over fiscal discipline.
Teppei Ino, chief analyst at Mitsubishi UFJ, noted, “Until a specific budget size is presented, concerns over Prime Minister Takaichi’s aggressive fiscal policy will persist, making the yen vulnerable to selling pressure.”
Junya Tanase, chief FX strategist at JPMorgan Chase, said, “The yen’s sell-off in response to the Takaichi administration has been larger than initially expected.”
The dollar index rose 0.018 points (0.018%) to 99.569.
The dollar remained broadly supported in New York trading as expectations for a shutdown resolution eased economic concerns.
The US Senate held a procedural vote on a bipartisan budget deal brokered by eight Republican and Democratic lawmakers the previous night, passing it by a 60-40 margin.
The government shutdown is likely to end later this week following a Senate vote. The House, where Republicans hold a majority, is expected to pass the measure without major obstacles.
Fiona Cincotta, senior analyst at City Index, said, “Once government operations resume, not only will investor sentiment improve, but the release of delayed economic indicators will provide a clearer picture of the US labor market and economic outlook.”
Karl Schamotta, chief market strategist at Corpay, noted, “With Veterans Day and a bond market holiday ahead, trading volumes are thin, and most participants are avoiding large directional positions amid ongoing uncertainty over US fundamentals.”
The dollar index briefly touched 99.732 during the session.
The euro-dollar rate edged down 0.00005 dollars (0.004%) to 1.15639 dollars.
The Australian dollar rose 0.0041 Australian dollars (0.631%) to 0.6538 against the US dollar.
Andrew Hauser, Deputy Governor of the Reserve Bank of Australia (RBA), commented, “Australia’s financial conditions are moving closer to a neutral stance, neither stimulating nor restraining the economy.” The market interpreted his remarks as hawkish, boosting the Australian dollar.
The offshore dollar-yuan (CNH) rate fell 0.0034 yuan (0.048%) to 7.1213 yuan.
The pound-dollar rate rose 0.00179 dollars (0.136%) to 1.31813 dollars.
UK Chancellor of the Exchequer Rachel Reeves again hinted at the possibility of tax increases, stating, “While the Labour Party could keep its pledge not to raise taxes, doing so would require significant cuts to capital spending.”
jwchoi@yna.co.kr
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