US Dollar Under Pressure, Markets Eye IEA Moves and Inflation Data
The US dollar weakened for the fourth consecutive day after reports emerged that the International Energy Agency (IEA) had proposed releasing the largest oil reserves in its history. This move is seen as helping to ease market concerns about global energy supplies, thus reducing the safe-haven momentum that had previously supported the US currency.
The Bloomberg Dollar Spot Index fell 0.1%, while the yield on the 10-year US Treasury bond also moved 1 basis point lower to 4.15%. According to the report, this release would surpass the 182 million barrels of oil released by IEA member countries in two tranches in 2022, when Russia launched its full-scale invasion of Ukraine.
Khoon Goh, ANZ's head of Asia research, said the US dollar weakened slightly because savings have traditionally been considered a safe-haven currency by default. Therefore, any news that could potentially reduce the risk of oil supply disruptions tends to be immediately reflected in dollar weakness. This sentiment also led market participants to slightly reduce their defensive positions.
Meanwhile, investor attention is now shifting to US inflation data, which will be released on Wednesday local time. February inflation is expected to rise 2.4% annually. In the foreign exchange market, the euro, Australian dollar, and pound sterling each strengthened by around 0.1% against the US dollar, while the Swiss franc and Japanese yen remained stable. This indicates that the market is still heading towards recovery from the combination of energy sentiment and US inflation. (asd)
Source: Newsmaker.id
