The dollar slipped on Oct. 20 amid questions over the durability of investment flows into U.S. artificial intelligence shares, while the euro, pound and yen all gained.
In a report published at 2:47 p.m. ET, Reuters put the dollar index at 101.71, down 0.25%, and the euro at $1.1235, up 0.22%. Sterling was at $1.338, up 0.59%, while the yen gained 0.21% to ¥158.14 per dollar.
Reuters said investment in U.S. AI shares had previously supported the dollar. Nomura head of G10 FX strategy Dominic Bunning told Reuters that interest rates rising far enough could undermine that investment trade. The report also noted falling oil prices and longer-dated U.S. Treasury yields.
On Oct. 14, the Bureau of Labor Statistics reported a seasonally adjusted 0.6% rise in consumer prices in September from August, following a 0.4% monthly increase in August. The unadjusted 12-month inflation rate reached 3.7%, up from 3.4% in the previous period.
In France, Prime Minister Sébastien Lecornu told lawmakers Oct. 20 that the government was preparing a large security deployment for protests planned for Oct. 24. Interior Minister Laurent Nuñez said Operation Sentinelle troops would guard fixed sites while police and gendarmes managed the demonstrations.
Britain’s Office for National Statistics estimated unemployment at 4.7% for June through August, down 0.1 percentage point from the preceding three months. Its estimate of job vacancies fell by 21,000 from the preceding three months to 691,000 in July through September. The agency said smaller firms had reported that higher labor costs may be restraining recruitment. Outside the pandemic period, vacancies were last at or below that level in July through September 2014.
At its Oct. 20 auction of 20-year government bonds, Japan’s Ministry of Finance accepted ¥537.1 billion from ¥3,139 billion in competitive bids. That produced a competitive bid-to-cover ratio of about 5.84.
The Bank of England’s next rate decision is scheduled for Nov. 5, followed by the next U.S. consumer price release Nov. 10 and U.K. labor release Nov. 17.
