The US dollar had its biggest weekly gain in 10 months amid speculation that the Federal Reserve will signal after a meeting next week that it is moving closer to raising interest rates for the first time since 2006.
The US currency reached a six-year high against the yen after a research paper from the San Francisco Fed said investors may be underestimating the pace of rate increases. Treasury two-year note yields jumped, burnishing the appeal of dollar-denominated assets. The pound touched a 10-month low as Scotland prepared to vote on independence, and currency-market volatility rose to the highest since February.
“The markets have shifted to expecting a more hawkish Fed statement,” Daniel Katzive, head of foreign-exchange strategy for North America at BNP Paribas SA, said in New York. “That’s boosted US front-end yields, and that should be supporting the dollar versus the euro and yen.”
The Bloomberg Dollar Spot Index rose 1.2 percent, the most since the five days ended Nov. 1 last year, in New York this week. The gauge touched 1,051.77 yesterday, the highest since July last year.
The yen dropped for a fifth week, the longest stretch this year, losing 2.1 percent to ￥107.34 per dollar. It touched ￥107.39, the weakest since Sept. 22, 2008. The euro was little changed at US$1.2963, after falling for the previous eight weeks. It reached US$1.2860, a 14-month low, on Tuesday. The shared currency rose 2.2 percent to ￥139.15.
Sterling fell for a second week against the dollar and euro as opinion polls showed Scotland’s vote on whether to leave the UK is too close to call.
One-month implied volatility, a measure of future price swings, jumped to the highest in almost three years before the referendum on Thursday. A “yes” vote would mean a 5 percent to 10 percent slide by the pound against the dollar within a month, according to 61 percent of the 31 respondents surveyed by Bloomberg between Sept. 5 and Thursday.
The currency declined 0.4 percent to US$1.6268 and touched US$1.6052, the weakest since Nov. 15 last year. Sterling depreciated 0.5 percent to ￡0.7969 per euro.
The Brazilian real and Australian dollar were the biggest losers among the greenback’s 31 major peers this week. The real slid 4.2 percent, the most since August last year, after a poll showed increased support for Brazilian President Dilma Rousseff amid a recession and above-target inflation. The Aussie sank 3.6 percent, also the most in more than a year.
Russia’s ruble sank to a record 37.97 per dollar as the EU and US widened sanctions amid conflict in Ukraine with pro-Russia rebels.
On Tuesday, US President Donald Trump weighed in on a pressing national issue: The rebranding of a restaurant chain. Last week, Cracker Barrel, a Tennessee company whose nationwide locations lean heavily on a cozy, old-timey aesthetic — “rocking chairs on the porch, a warm fire in the hearth, peg games on the table” — announced it was updating its logo. Uncle Herschel, the man who once appeared next to the letters with a barrel, was gone. It sparked ire on the right, with Donald Trump Jr leading a charge against the rebranding: “WTF is wrong with Cracker Barrel?!” Later, Trump Sr weighed
HEADWINDS: Upfront investment is unavoidable in the merger, but cost savings would materialize over time, TS Financial Holding Co president Welch Lin said TS Financial Holding Co (台新新光金控) said it would take about two years before the benefits of its merger with Shin Kong Financial Holding Co (新光金控) become evident, as the group prioritizes the consolidation of its major subsidiaries. “The group’s priority is to complete the consolidation of different subsidiaries,” Welch Lin (林維俊), president of the nation’s fourth-largest financial conglomerate by assets, told reporters during its first earnings briefing since the merger took effect on July 24. The asset management units are scheduled to merge in November, followed by life insurance in January next year and securities operations in April, Lin said. Banking integration,
LOOPHOLES: The move is to end a break that was aiding foreign producers without any similar benefit for US manufacturers, the US Department of Commerce said US President Donald Trump’s administration would make it harder for Samsung Electronics Co and SK Hynix Inc to ship critical equipment to their chipmaking operations in China, dealing a potential blow to the companies’ production in the world’s largest semiconductor market. The US Department of Commerce in a notice published on Friday said that it was revoking waivers for Samsung and SK Hynix to use US technologies in their Chinese operations. The companies had been operating in China under regulations that allow them to import chipmaking equipment without applying for a new license each time. The move would revise what is known
Artificial intelligence (AI) chip designer Cambricon Technologies Corp (寒武紀科技) plunged almost 9 percent after warning investors about a doubling in its share price over just a month, a record gain that helped fuel a US$1 trillion Chinese market rally. Cambricon triggered the selloff with a Thursday filing in which it dispelled talk about nonexistent products in the pipeline, reminded investors it labors under US sanctions, and stressed the difficulties of ascending the technology ladder. The Shanghai-listed company’s stock dived by the most since April in early yesterday trading, while the market stood largely unchanged. The litany of warnings underscores growing scrutiny of
RSS