Wednesday, 24 April 2024

Dollar down as risk appetite improves after intervention to ‎save banks

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US dollar fell today, Friday, after the authorities and banks in the United States moved to provide support to a troubled bank with the aim of relieving pressure on the financial system, which restored some confidence to investors.

According to “Reuters”, large US banks pumped on Thursday $30 billion in deposits into First Republic Bank to save it after it was stuck in the crisis caused by the collapse of two other medium-sized US banks last week.

The bank’s rescue boosted risk appetite around the world on Friday, giving way to risk-sensitive currencies such as the Australian and New Zealand dollars.

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This week, he brought back to mind the financial crisis that occurred in 2008, when dozens of institutions failed to fulfill their obligations or obtained billions of dollars in government and central bank rescue packages.

Three US banks received support from regulators and other banks. In Europe, Credit Suisse became the first major global bank to obtain emergency support from the Swiss Central Bank since the financial crisis, which restored investor confidence and stopped the bleeding in customer deposits.

The dollar index fell 0.21 percent to 104.07

European Central Bank went ahead and raised interest rates by 50 basis points at its monetary policy meeting on Thursday.

In the latest dealings, the euro rose 0.3 percent against the dollar to $1.0646, and rose 0.2 percent against the pound to 87.75 pence. Since the beginning of the week, the euro has been struggling to record an increase against the dollar, and lost 0.8 percent against the pound sterling.

Sterling rose 0.12 percent to $1.2132, while the Swiss franc rose 0.35 percent.

The Japanese yen also rose, which also tends to benefit from times of volatility and stress. It increased in the latest transactions by 0.5 percent, to 133.13 per dollar, and is heading to record a weekly rise of one percent.

The Australian dollar, which usually performs well in times of investor optimism, jumped 0.8 percent to $0.6707, while the New Zealand dollar rose 0.9 percent to $0.625.

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