US dollar jumps again, Canadian dollar hit hardest
The bid in the dollar is relentless
Yesterday we could point to rising Treasury yields as a catalyst for dollar strength but today yields are down and the dollar is jumping anyway. They buying this week has been relentless.
The move goes right across the board but USD/CAD is particularly strong, up 92 pips to 1.2740.
Some are pointing to the ECB tomorrow and a desire to sell euros ahead of it.
I suspect these are more macro-driven or flow-driven moves. On the macro side, China’s ‘common prosperity’ push and the growing realization that bottleneck problems will continue for many months is a reason for avoiding growth-sensitive currencies. On flows, we’re still at the start of a new month and Sept flows can be large as fund managers make post-vacation shifts.