TOKYO (Reuters) – The dollar extended gains against most currencies on Thursday as signs of economic slowdown in Europe and the United States renewed concern about a second wave of coronavirus infections.
The euro, which has already taken a hit due to worries about a return to severe lockdown restrictions, faces an additional hurdle later on Thursday with the release of data on German business sentiment.
The dollar is likely to continue to rise as another spike in coronavirus cases and the Federal Reserve’s warnings that the U.S. economy needs more fiscal stimulus cause investors to repatriate funds from riskier assets.
“Risk is being sold across the board, and there is a big unwinding of dollar shorts,” said Yukio Ishizuki, foreign exchange strategist at Daiwa Securities.
“Questions surrounding the coronavirus and the need for even more stimulus are turning flows back to the dollar.”
The dollar traded at $1.1658 per euro on Thursday in Asia, just shy of a two-month low high reached on Wednesday.
The pound bought $1.2714, near its weakest level since late July.
The dollar was quoted at 0.9240 Swiss franc , which is near a nine-week high.
The U.S. currency bought 105.40 yen , holding onto a 0.4% gain from the previous session.
The dollar has rallied this week as rising coronavirus infections in Europe and Britain undermined investor optimism about vaccine progress.
The Ifo survey due later on Thursday is forecast to show an improvement in business morale in Germany, Europe’s largest economy.
However, sentiment for the euro has already suffered a big blow after surveys released on Wednesday showed new restrictions to quell a resurgence in coronavirus infections slammed the euro zone’s services industry into reverse.
The mood for riskier assets has also soured after data on Wednesday showed U.S. business activity slowed in September and several Fed policymakers warned that further government aid is needed to bolster the economy.
The dollar index =USD>, which pits the dollar against a basket of six major currencies, stood at 94.336 on Thursday, close to a nine-week high.
There are no major economic data releases scheduled during the Asian session, so trading could be subdued, analysts said.
Some investors are watching the Australian and New Zealand dollars, which have come under pressure due to growing expectations for additional monetary easing.
A recent decline in commodity prices is expected to increase downside risks for the Antipodean currencies, some traders say.
The Aussie traded at $0.7069, near its weakest since July 21.
Across the Tasman Sea, the kiwi bought $0.6549 after tumbling by 1.3% in the previous session.
(Reporting by Stanley White; Editing by Sam Holmes)
OTTAWA – The parliamentary budget officer says the federal government likely failed to keep its deficit below its promised $40 billion cap in the last fiscal year.
However the PBO also projects in its latest economic and fiscal outlook today that weak economic growth this year will begin to rebound in 2025.
The budget watchdog estimates in its report that the federal government posted a $46.8 billion deficit for the 2023-24 fiscal year.
Finance Minister Chrystia Freeland pledged a year ago to keep the deficit capped at $40 billion and in her spring budget said the deficit for 2023-24 stayed in line with that promise.
The final tally of the last year’s deficit will be confirmed when the government publishes its annual public accounts report this fall.
The PBO says economic growth will remain tepid this year but will rebound in 2025 as the Bank of Canada’s interest rate cuts stimulate spending and business investment.
This report by The Canadian Press was first published Oct. 17, 2024.
OTTAWA – Statistics Canada says the level of food insecurity increased in 2022 as inflation hit peak levels.
In a report using data from the Canadian community health survey, the agency says 15.6 per cent of households experienced some level of food insecurity in 2022 after being relatively stable from 2017 to 2021.
The reading was up from 9.6 per cent in 2017 and 11.6 per cent in 2018.
Statistics Canada says the prevalence of household food insecurity was slightly lower and stable during the pandemic years as it fell to 8.5 per cent in the fall of 2020 and 9.1 per cent in 2021.
In addition to an increase in the prevalence of food insecurity in 2022, the agency says there was an increase in the severity as more households reported moderate or severe food insecurity.
It also noted an increase in the number of Canadians living in moderately or severely food insecure households was also seen in the Canadian income survey data collected in the first half of 2023.
This report by The Canadian Press was first published Oct 16, 2024.
OTTAWA – Statistics Canada says manufacturing sales in August fell to their lowest level since January 2022 as sales in the primary metal and petroleum and coal product subsectors fell.
The agency says manufacturing sales fell 1.3 per cent to $69.4 billion in August, after rising 1.1 per cent in July.
The drop came as sales in the primary metal subsector dropped 6.4 per cent to $5.3 billion in August, on lower prices and lower volumes.
Sales in the petroleum and coal product subsector fell 3.7 per cent to $7.8 billion in August on lower prices.
Meanwhile, sales of aerospace products and parts rose 7.3 per cent to $2.7 billion in August and wood product sales increased 3.8 per cent to $3.1 billion.
Overall manufacturing sales in constant dollars fell 0.8 per cent in August.
This report by The Canadian Press was first published Oct. 16, 2024.
