The U.S. Dollar crept higher against its major rivals during the Asian trading session but stayed close to recent trading ranges due to wary investors who are worried about the Chinese liquidity situation. On Wednesday, interest rates on short-term money market accounts rose to a 3-month peak after the central bank there neglected to increase liquidity, causing Chinese regulators to express their concerns and suggesting that they might intervene to counteract risks to inflation.
As reported at 12:26 p.m. (JST) in Tokyo, the USD/JPY pair was trading higher at 97.3650 Yen, but remained close to yesterday’s 2-week trough of 97.1885 Yen. The USD/CHF pair steadied at 0.8920 Swiss Francs, moving away from a 2-year low of 0.8908 which was hit yesterday. The EUR/USD had slipped farther away from Wednesday’s 23-month high of $1.3794 and was trading at a low of $1.3776 before reversing course and trading higher at $1.3788; investors are likely to be wary of the common currency as they assess concerns about the Eurozone banking sector. The U.S. Dollar Index was still trying to inch farther away from the 2013 low of 78.918 .DXY and was trading at 79.282 .DXY.
China Data Provides Some Relief
Market players had been wary ahead of the release of the latest manufacturing data from China which would weigh heavily on risk appetite. But the HSBC Manufacturing PMI preliminary data for October showed a reading of 50.9, slightly above expectations of 50.5, which helped to assuage those concerns. That gave a lift to the AUD/USD pair which traded higher at a session high of 0.9667 before edging lower to 0.9649.