US Dollar Dips, Asian Currencies Gain After China’s GDP Release
Arslan Butt • 1 min read
The US dollar is starting the fresh trading week on a weak footing, even as Asian currencies receive a boost from China’s latest GDP data reassuring markets of economic recovery in the aftermath of the coronavirus pandemic. At the time of writing, the US dollar index DXY is trading around 93.61.
The US dollar’s safe haven appeal remains supported by concerns about a rise in coronavirus cases around the world as winter approaches, forcing government to reimpose restrictions. In addition, uncertainty about the upcoming presidential elections and fiscal stimulus package in the US also keep the greenback in favor among traders.
The previous week saw the US dollar gaining around 0.7% of its value amid a risk averse mood in markets. Worries about a resurgence in cases weakened its major peers, the EUR and the GBP.
On the other hand, trade-exposed currencies in Asia like the CNH, AUD and NZD strengthened against the dollar after China’s Q3 GDP came in at 4.9%. While the GDP reading missed expectations, both industrial output and retail sales posted a stronger than expected growth, assuring markets of the economic recovery in China.