Demand for Safe Haven Currencies Wane on Equities Rally

The Swiss Franc and Japanese Yen, both deemed safe haven currencies by FX traders, lost ground in today’s trading as appetite for risk is whetted after a rally in global equities. Nonetheless, many FX traders are taking and breather and anxiously awaiting a policy decision from the Federal Reserve Bank which is due out later today, as well as a slew of US-based economic data. For the most part, analysts don’t expect the Fed to take on a hawkish bias given the recent dismal labor report, and believe that the accompanying statement will hint at a future rate hike much further along in the year than previously anticipated. A dovish or even somewhat balanced tone could leave the Dollar under pressure.

As reported at 10:55 am (BST) in London, the USD/JPY was trading at 106.3170 Yen, up 0.27% while the EUR/CHF is higher at 1.0833 Swiss Francs, a gain of 0.30%. The EUR/USD was up 0.13% at $1.1226; today’s trading range saw a low of $1.1189 and a peak of $1.1236,

Brexit Fears Still Prevalent

The issue of a possible Brexit could also impact the Fed’s decision making process. It seems that the latest polls show a slight lead for the “leave” campaigners. Britons will vote in a referendum to withdraw from the European Union on June 23rd. The Pound has been under significantly heavy pressure with accompanying volatility as a result of the uncertainty of a Brexit but has recovered in today’s trading. The GBP/USD was trading at $1.4203, a gain of 0.63% while the EUR/GBP was down 0.51% to trade at 0.7901 Pence.

Barbara Zigah

After working on Wall Street, Barb began her second career as a freelance writer at Daily Forex, where the CEO recognized fresh, untapped potential and was willing to give her a try. She’s never looked back. Since then, she’s worked steadily as a freelance writer and editor in the financial services and Forex-related industry.