Investors sell off USD following China Report

By: Barbara Zigah
With the issuance of a report out of China suggesting that the central bank should increase their holdings in the Japanese Yen and single currency Euro in their foreign reserves, investors sold off the U.S. currency, driving the U.S. down to a new 14-month trough versus the Euro in Asian trading today. As reported at 2:25 p.m. (JST) in Tokyo, the U.S. Dollar dropped to $1.5064 on the EBS trading platform, the lowest price since August of last year. The report, from the Financial News, a publication of the People’s Bank of China, suggested that while the greenback should remain China’s primary foreign currency in their reserves, the percentage of shares in the Yen and Euro, as well as the Australian Dollar, should be increased.

That article also helped to prop up the AUD, which traded at $0.9241 versus the U.S. Dollar, a rise of .3% and nearing the 14-month peak established last week. Earlier in the trading day, the Aussie had traded lower after the release of 3rd quarter numbers for Australia’s Producer Price Index, which showed only a modest gain thus removing some of the pressure that has been put upon the Australian central bank to raise interest rates.

Barbara Zigah is a freelance journalist living in Ghana, who specializes in Forex-related content; her online work has appeared in the IB Times, NASDAQ, Benzinga, and Seeking Alpha.