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Pakistan Deaths
Pakistan Cases

NEW YORK/LONDON: The US dollar languished again on Tuesday, particularly against the Swiss franc and Japanese yen, as questions about slowing US economic growth and the COVID-19 Delta variant tempered risk appetite.

The US dollar fell just below 109 yen, losing nearly 0.4% for the second day and it traded against the Swiss franc as much as 0.3% lower. The franc also gained against the euro to its greatest value in nine months. “The Swiss franc and the yen are benefiting as rising coronavirus cases cloud the outlook for growth,” said Joe Manimbo, senior market strategist at Western Union Business Solutions. But the moves to the safe haven franc and yen also came alongside reminders that currencies are sensitive to talk from central bankers about pulling back on bond purchases and eventually raising rates as their economies come out of the worst of the coronavirus pandemic. Relatively hawkish comments by central bank officials in Australia and New Zealand on Tuesday led the Australian dollar and the Kiwi dollar to big gains among major currencies.

The Kiwi dollar rose as much as 0.6% early in the day after New Zealand’s central bank said it would soon begin consulting on ways to tighten mortgage lending standards as it tries to control an inflated housing market and protect home buyers. The Australian dollar spiked higher after the Reserve Bank of Australia stuck with its plan to taper its bond-buying program, shrugging off concerns about the economic impact from rising coronavirus cases. It gained half a percent against its US counterpart before falling back to up 0.1%.

The index that measures the dollar’s strength against a basket of peers was down by a hair at 92.026 at 1413 GMT, after declining slightly on Monday. Last week the dollar lost nearly 1% as US Federal Reserve policy makers said they expected it would still be while before job growth allowed them to pull back on support for the economy.

Strategists have said they do not expect additional major moves in the dollar before Friday’s US jobs report and maybe not until Fed officials speak at the end of August at a symposium of central bankers in Jackson Hole, Wyoming.

The euro was a touch higher at $1.1874, having lost some momentum after hitting a one-month high of $1.1909 on Friday. Sterling gained as much as 0.3%,, just off Friday’s one-month high, before easing to up 0.1%.

On Thursday the Bank of England will meet and could send hawkish signals on its policies amid optimism about the British economy.

The 10-year US Treasury yield slipped again on Tuesday to 1.169% at mid-morning in New York, continuing a downward trend since the end of March.

Market watchers have pointed to the decline in the 10-yield as a sign of coming disappointment in economic growth, especially with the rise of the Delta variant of COVID-19. “What’s keeping the dollar from really benefiting from the flight to safety is that Treasury yields continue to grind lower,” Manimbo said. In the United States, COVID-19 hospital admissions in Louisiana and Florida have hit a new peak though top US health expert Anthony Fauci has ruled out another lockdown in the country.

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