Dollar Continues to Strengthen, Yen Weakens After Sanae Takaichi's Comments
The US dollar continued to strengthen against most Group of 10 (G10) currencies, as selling pressure on precious metals deepened. However, the dollar's momentum eased slightly from its highs in early Asian trading.
The two currencies most affected were the Japanese yen and the Australian dollar, each falling around 0.2% against the US dollar. The yen weakened after Takaichi corrected her comments on the weak yen, calling it a "huge opportunity" for export-oriented industries.
Meanwhile, the Australian dollar was also under pressure due to worsening commodity sentiment. The AUD/USD pair fell as much as 0.6% to 0.6921, in line with gold and silver prices, which continued to decline on Monday.
The most intense market focus was on silver. Silver prices fell around 12% on Monday after a sharp drop on Friday, triggered by a shift in market expectations following the nomination of Kevin Warsh as the Fed Chair. These extreme movements have exacerbated volatility in related assets and weighed on broader commodity sentiment.
According to Chris Weston of Pepperstone, market attention "naturally" remains focused on silver, gold, and the US dollar. He believes the movement of the silver-dollar pair even serves as an example of trading in a market that is not functioning normally due to extreme liquidity and positioning.
From a technical perspective, USD/JPY is said to be consolidating in the daily Ichimoku cloud area. However, the bullish momentum that has begun to improve from oversold conditions opens up the opportunity for further strengthening if buying pressure continues. Meanwhile, NZD/USD is relatively flat at 0.6023, EUR/USD is stable at 1.1854, and GBP/USD is virtually unchanged at 1.3689.
Source: Newsmaker.id
