September 25, 2023


The dollar sagged against other major currencies, pushing the pound up by almost 0.8% to $1.1453 and boosting the euro by 0.4% to near-parity at $0.99975.

Global stocks edged higher in volatile trade on Monday, even though Beijing denied it would consider easing its zero COVID-19 policy, which stemmed safe-haven flows into the dollar ahead of potentially pivotal consumer inflation data this week.

Risk assets had rallied on Friday amid speculation China was preparing to relax its pandemic restrictions, but over the weekend health officials reiterated their commitment to the “dynamic-clearing” approach to COVID cases as soon as they emerge.

“We can question whether the China story has any veracity, but the market is quite happy to give it credence for the moment, despite the big denials,” CIBC Capital Markets head of G10 currency strategy Jeremy Stretch said.

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