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TEHRAN, September 24 - The dollar edged higher on Monday, snapping a two-week losing streak, as investors bought the greenback before a widely expected interest rate hike by the U.S. central bank this week while trade war concerns checked investor appetite for risk.
TEHRAN, Young Journalists Club (YJC) - The dollar edged higher on Monday, snapping a two-week losing streak, as investors bought the greenback before a widely expected interest rate hike by the U.S. central bank this week while trade war concerns checked investor appetite for risk.
The dollar had struggled as trade war concerns faded and emerging market central banks led by Turkey took aggressive steps to stabilize their markets.
But the weekend brought tensions back into the spotlight and boosted the dollar after Beijing released a white paper on the trade dispute saying it would seek a reasonable outcome, while also describing U.S. tactics as “bullying.
With the U.S. Federal Reserve set to increase interest rates by a quarter point for the eighth time since late 2015, speculators ramped up bets that interest rate differentials between the United States and other major economies, particularly Europe, will stretch wider.
“We typically see this brief window before a U.S. rate meeting when hedge funds buy the dollar and the trade war headlines are also aggravating that trend,” said Viraj Patel, an FX strategist at ING in London.
Latest positioning data confirms that trend with net speculative long positions on the greenback increasing by its biggest daily rise in more than two months.
The greenback .DXY rose 0.1 percent to 94.37 against a basket of its rivals as net long positions for the dollar swelled to $25 billion according to CFTC data.
Source:Reuters
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