The dollar edged up from near its lowest levels of the month at the start of trading in Asia on Monday as violent protests in France put pressure on the euro. The euro declined by 0.1% to $1.1225 as trading commenced in Asia. The largest component of the dollar index, the decline of the common currency contributed to stabilising the greenback, which was trading flat at 101.83. French President Emmanuel Macron condemned on Sunday “shocking” scenes of violence on the sidelines of protests over the cost of living in a televised address to the nation, a day after France suffered one of its worst days of unrest in years. “The weekend unrest matters for the euro mainly through French bonds rather than directly,” said Kieran Williams.
Against the yen , the US dollar was flat at 158.00 yen as Bank of Japan Governor Kazuo Ueda said on Monday underlying inflation is “quite close” to the central bank’s 2% target. The US dollar remained unchanged at 6.6842 yuan in offshore trading, as market participants awaited the upcoming release of Chinese GDP data for the third quarter. China’s economy is anticipated to have accelerated modestly from a level that has been the lowest in over three years. In emerging market Asia, considerable attention will be directed toward the Indonesian rupiah in light of a recent warning from MSCI regarding a potential downgrade of the country’s stock market to “standalone” status.
“This is a run up week to the Fed on October 28 and the ECB on October 29, so positioning is likely to stay light and headline risk out of France will remain high,” InTouch’s Williams added. The Australian dollar appreciated 0.3% to $0.6965, while its kiwi counterpart remained unchanged at $0.5656. The British pound remained unchanged at $1.3329. Oil prices experienced a decline as trading resumed in Asia on Monday, with Brent crude futures decreasing by 1.7% to $108.02. This movement followed the announcement by US President Donald Trump regarding the waiver of sanctions and tariffs on Russia, which could potentially result in an increase in Russian fuel exports.
Fed funds futures indicate an implied 84% probability that the Federal Reserve will maintain its current stance at the upcoming two-day meeting on October 28, a figure that has seen little fluctuation since Friday, as reported by the CME Group’s FedWatch tool. “This is a run-up week to the Fed on October 28 and the ECB on October 29, so positioning is likely to remain light, and headline risk out of France will continue to be elevated,” noted InTouch’s Williams.
