Antipodeans work hard to prevent Omicron from falling; cryptocurrency licks weekend wounds Reuters

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© Reuters. File photo: Photo caption of US dollar, Swiss franc, British pound and euro banknotes taken in Warsaw on January 26, 2011. REUTERS/Kacper Pempel

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Author: Tom Westbrook

Sydney (Reuters)-On Monday, the riskier currency struggled to gain a foothold against the U.S. dollar, benefiting from the uncertainty of the Omicron variant and the expectation of more popular U.S. inflation data that put upward pressure on interest rates.

Cryptocurrency suffered huge losses during a crazy weekend, crushing Bitcoin by more than 20% in one stage. It found support at around $49,000 on Monday.

As preliminary observations in South Africa indicated that Omicron patients had relatively mild symptoms, Antipodeans was also frustrated by the sharp drop in early Asian transactions.

It rose 0.3% to $0.7016, recovering from a 13-month low. Increased 0.1% to 0.6750 US dollars.

Due to cautious optimism, the safe-haven yen also fell 0.1% to US$113.00 per US dollar on Monday, but analysts expect that trading will likely be sensitive to Omicron news and Friday’s US inflation data, so the future trend will be bumpy.

The euro finally held steady at 1.1303 US dollars and the British pound held steady at 1.3232 US dollars.

“Maybe we should look for volatility rather than trends,” said an analyst at ANZ Bank. Volatility indicators for the Australian and New Zealand dollars, which were hit hard on Friday, hit their highest levels in about eight months as the two currencies fell. [AUD/]

Little is known about Omicron. It is currently found in about one-third of the states in the United States, and cases have also been detected in Europe, Asia, and Southern Africa.

According to an article published by the South African Medical Research Council based on early observations in Pretoria, most COVID-19 patients have other reasons for admission and are not dependent on oxygen-which is better than previous wave of viruses.

The volatility in the U.S. Treasury bond market in recent trading days has also made traders feel uneasy, as the U.S. yield curve has flattened sharply in anticipation that the Fed will take action soon to calm inflation and eventually curb long-term growth.

The U.S. employment report last week was mixed and hardly shaken the market’s expectations for more aggressive austerity policies. The consumer price report released on Friday will soon become another case of early reduction and provide support for the U.S. dollar.

This week began to stabilize at 96.211, within the range of the November 16-month high of 96.938.

The interest rate futures market has set US interest rates to rise around the middle of next year, but even by the end of 2026, they will only reach a high of around 1.5%. Traders are cautious about this rapid change.

“This is a difficult issue to reconcile,” said Chris Weston, director of research at Pepperstone, the agent. “This shows that the market believes that the Fed will stop raising interest rates after raising interest rates five times, which is far below the median expected value of the Fed.”

Weston said that a year-on-year inflation rate of higher than 7%-compared with the 6.7% expected by economists-may falter.

He said: “Inflation with a large number of 7 will make the dollar higher.”============================= ==========================

Currency bid price at 0033 GMT

Describe the last U.S. closing percentage change of RIC YTD percentage high bid low bid

Previous changes

Meeting

Euro dollar

1.1299 USD 1.1311 USD -0.08% -7.51% +1.1327 +1.1299

USD/JPY

112.9150 112.8500 +0.12% +9.38% +113.0550 +112.9800

EUR/JPY

127.59 127.55 +0.03% +0.53% +127.8200 +127.5600

USD/Switzerland

0.9191 0.9177 +0.15% +3.88% +0.9191 +0.9183

GBP/USD

1.3229 1.3232 +0.01% -3.14% +1.3240 +1.3228

USD/Canada

1.2840 1.2847 -0.06% +0.82% +1.2840 +1.2817

AUD/USD

0.7008 0.7001 +0.14% -8.87% +0.7020 +0.6995

new Zealand

USD/USD 0.6746 0.6748 +0.05% -5.98% +0.6758 +0.6751

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Tokyo foreign exchange market information from the Bank of Japan

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