(New York) The dollar was conquering Wednesday against most currencies, taking advantage of its status as a safe haven valued by investors alarmed by the extension to Europe of the banking crisis that had started in the United States.
The greenback gained 1.47% on the single currency, to 1.0577 dollars for one euro. Earlier, the common currency of 20 European countries had fallen to $1.0516, the lowest since January.
“When markets are in bad shape, the dollar tends to do well,” explained Mazen Issa of TD Securities.
After weakening earlier this week due to the recalibration of monetary policy expectations by the US central bank (Fed), “the dollar has regained its safe haven status”, according to the analyst.
Conversely, the euro paid for the shock experienced on the stock market by the largest banks in the zone, contaminated by the crisis of confidence affecting Credit Suisse.
For some, including economists at SwissRe, “the European Central Bank (ECB) may not raise its key rate” on Thursday, in light of the recent turmoil in the financial system.
The president of the institution, Christine Lagarde, however announced, a few weeks ago, an increase of half a point during this meeting.
Very popular at the beginning of the week, because considered a safe bet, the Swiss franc was in retreat, undermined by the difficulties of Credit Suisse.
Besides the dollar, the other big winner of the day was the yen, which retains the luster of a low-risk asset. For Mazen Issa, the Japanese currency also benefited from the collapse of European and American bond rates.
The difference in rates between Japan and the other major economies, which have all been tightening monetary policy for many months, has suddenly narrowed, making it more attractive, in relative terms, to invest in Japanese assets.