Dollar Plunges against Major Counterparts as Europe Shares Nosedive

0
133

Dollar Plunges against Major Counterparts as Europe Shares NosediveThe dollar plunged versus its major counterparts as emerging-market stocks rallied to their highest point in four months.

The New Zealand kiwi rose 0.8 percent to 86.68 per dollar in early morning trade in New York, while South African rand surged 0.7 percent to touch its highest level since January 1. The Stoxx Europe 600 Index fell 0.9 percent, continuing with its losing streak, while the MSCI Emerging Markets Index rose 0.6 percent.

Standard & Poor’s 500 Index futures fell 0.3 percent, indicating that the measure will post its largest three-day decline since January.

Currency swings have declined to a six-year low as central banks from Japan to U.S. sought to bolster growth using record-low borrowing rates and cheap cash, making investors seek refuge in higher-yielding assets.

**relatedarticle**

“There certainly has been more interest again in emerging markets, suggesting that many investors are again looking out for yield,” Jane Foley, a London-based senior foreign-exchange strategist at Rabobank International told Bloomberg. “That’s clearly a risk-on scenario that is dollar-negative.”

The JPMorgan Global FX Volatility Index remained slightly unchanged at 6.99 percent, after falling to 6.98 percent on Monday, its lowest level since July 2007.

The Bloomberg Dollar Spot Index plunged 0.4 percent to stand at 1,010.99, its lowest since November 1. The euro advanced 0.2 percent to $1.3768, while the yen rose 0.5 percent to 102.57 per dollar.

Separately, Russia further stocked tensions by warning Ukraine to stop all military exercises to the East of the country immediately, or “risk civil war”.  This sent eight stocks plunging for every one share that gained on the Stoxx 600 Index.

To contact the reporter of this story; Jonathan Millet at john@forexminute.com