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.
Poland is betting on a flood of investments and technology transfers from Taiwanese companies to reengineer its US$1 trillion economy. Polish Prime Minister Donald Tusk said yesterday that Poland will no longer be “just an assembly hub” as it pursues further investments from the likes of Foxconn Technology Group (富士康). The firm, whose full name is Hon Hai Precision Industry Co (鴻海精密), last month agreed to build electric vehicles (EVs) in the European Union nation and now could be a partner in a semiconductor venture, he said. The government’s aim is to boost manufacturing and the country’s high-tech chops in an era
RESTRICTION BREACH: ASML said that it denies ‘unfounded rumors regarding non-compliance with export controls concerning China,’ and enforces controls strictly US Secretary of Commerce Howard Lutnick in a series of recent meetings outlined concerns to Dutch chip-equipment giant ASML Holding NV’s senior leaders that one of its top-of-the-line machines might have made its way into China, in violation of US-led export restrictions. In the meetings, Lutnick expressed concern to ASML executives over the company’s extreme ultraviolet lithography (EUV) machines, people familiar with the talks said. EUV systems are used by firms such as Taiwan Semiconductor Manufacturing Co (台積電) to manufacture processors for the likes of Nvidia Corp and Apple Inc. ASML has never been allowed to ship them to China because of curbs
Google DeepMind vice president John Jumper, who won the 2024 Nobel Prize in chemistry for his work on artificial intelligence (AI), is leaving the company to join Anthropic PBC. Jumper has been a key member of Google’s AI coding development team and his departure strains the tech giant’s efforts to beat Anthropic, OpenAI and SpaceX in the race to build the most powerful AI models. Google has struggled to sell AI coding tools to businesses, according to former employees. Employees and executives at DeepMind have raised concerns in the past few months that the company does not have a clear solution for
BAD FAITH LITIGATION? The two companies, owned by a California-based private equity firm, could be seeking licensing fees or a settlement payout with the suit Taiwan Intellectual Property Office (TIPO) Director-General Liao Cheng-wei (廖承威) said yesterday he suspected that two firms suing contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) for patent infringement are “patent trolls.” A patent troll refers to a company that buys patents not for manufacturing products, but to sue other companies for compensation, accusing them of using its patents. Patent trolls, formally called Non-Practicing Entities or Patent Assertion Entities, were responsible for more than 50 percent of lawsuits in the US last year, costing targeted businesses tens of billions of US dollars a year, according to the US-based LegalCharity Web site. Asked whether
RSS