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Why the U.S. dollar doesn’t always act like a haven when geopolitical tensions rise – MarketWatch



One of these things is not like the other: Treasurys, gold and the U.S. dollar.

Good for you if you picked the dollar. Unlike those other two assets, the U.S. currency didn’t seem to attract much buying interest as investors shunned global stocks at the end of last week and went looking for safety following a U.S. military strike that killed a top Iranian military commander and heightened Middle East tensions.

“Increased tensions between the U.S. and Iran could lift the dollar — at least against non-major currencies — although we tend to see these sorts of geopolitical rows favoring the yen and Swiss franc first and foremost,” wrote Steven Barrow, head of G-10 strategy at Standard Bank, in a Monday note.

On Friday, gold jumped and Treasury prices soared, yanking down yields, as global equities sold off in the wake of the strike. Gold

GC00, -0.11%

 continued to gain ground on Monday, though Treasury yields edged higher as U.S. stocks put in a mixed performance, signaling that Middle East jitters were fading. The S&P 500

SPX, -0.28%

 edged up 0.1%, while the Dow Jones Industrial Average

DJIA, -0.42%

 was little-changed after both indexes booked losses on Friday.

Read: What stock-market investors need to know about intensifying U.S.-Iran tensions

The ICE U.S. Dollar Index

DXY, +0.23%,

a gauge of the currency against a basket of six major rivals, was off 0.2% Monday at 96.665 after ending 2019 on a soft note. The index saw little movement overall on Friday as stocks stumbled, with a modest gain by the U.S. currency against the euro

EURUSD, -0.3318%,

which has a nearly 58% weight in the index, offset partly by a sharp gain for the Japanese yen

USDJPY, +0.27%,

which is weighted at around 14%.

The dollar rose 0.1% versus the euro on Friday but tumbled 0.4% versus the yen. The dollar was virtually unchanged versus the franc

USDCHF, +0.0206%

 on Friday after setting a 15-month low versus the Swiss currency on New Year’s Eve, according to FactSet data.

The dollar was up 0.3% on Monday after earlier slipping to a 2 ½-month low below ¥108. The dollar was off 0.5% versus the Swissie, however, fetching 0.968 franc.

The yen and the Swiss franc have long enjoyed reputations as havens during periods of geopolitical stress. Analysts have attributed the strength in part to the large current-account surpluses, measures of excess savings in the economy, carried by both countries. That translates into large holdings of foreign assets by investors in Japan and Switzerland and, the expectation goes, that those investors are quick to repatriate some funds when the going gets rough, lifting their respective currencies.

That doesn’t mean the U.S. dollar, the world’s reserve currency, doesn’t have appeal of its own.

Its haven-like properties, however, seem to “really come to the fore when there’s a global liquidity crunch, as we saw back in 2008, and traders/investors scramble to secure dollars,” Barrow wrote.

“When, instead, geopolitical tensions arise that do not tighten liquidity conditions, the dollar is more likely to fall against other major havens, such as the yen and Swiss franc, and will probably trade sideways against the euro,” said Barrow, who expects the dollar to lose around 5% to 10% in broad trade-weighted terms in 2020.

A weaker buck appears to be the consensus call heading into 2020, though skeptics contend that factors that have previously frustrated dollar bears continue to underpin the currency. These include a domestic economy that still outshines its international peers as well as higher U.S. yields, despite the Federal Reserve’s series of three rate cuts last year.

Related: Why U.S. dollar bears could be thwarted in 2020

The “initial setting” coming into 2020 “is that U.S. yields and interest rates are high enough to support the dollar,” said Carl Weinberg, chief economist at High Frequency Economics, in a Sunday note. But he worried that the advantage could be offset by a “decaying” U.S. trade position that goes beyond concerns over the U.S.-China relationship.

A decline in world exports and falling U.S. sales abroad means less demand for dollars to finance transactions, he said, arguing that in the big picture, “dollar atmospherics” are unclear. More questions than answers surround President Donald Trump’s pending impeachment trial, deepening conflict with Iraq and other factors on the U.S. dollar.

“Our best guess is for a directionless dollar early on as the various storylines sort themselves out,” Weinberg said. “The drop in world trade seemingly is not over. That points to downside risks for the greenback.”

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Pandemic opens doors to switch jobs in Japan, but pay not rising much



The  Covid-19 pandemic has unexpectedly helped Japan’s nursing homes and  Information Technology companies overcome years of labour shortages, as job cuts at restaurants and hotels have prompted workers to look for new careers.

This newfound job mobility marks a shift in a country whose rigid labour practices are partially blamed for a long term decline in productivity.

But it is too soon to say whether the change will ultimately lead to higher wages, which are desperately needed to revive demand and growth in an economy that is still struggling to break free from decades of deflation.

For now, the job-hoppers tend to trade one low-paying career for another.

Toshiki Kurimata, who used to make 2.8 million yen ($25,000) a year as a masseur, quit after 12 years as the pandemic caused a sharp drop in customers. Now he works at a nursing care centre and is taking classes to become a registered caregiver.

With that qualification, he expects to earn around 3.3 million yen – an increase of about 18%. The even bigger attraction, he says, is job stability.

“I like working in nursing care and it’s stable,” Kurimata said. “There aren’t age limits on the work and you can find work even if, like me, you are inexperienced.”

Experts aren’t sure whether the job-switching will remain limited to certain industries or become a broader trend.

It is also uncertain whether job switching will continue once the pandemic dies down, although anecdotal evidence suggests people will keep leaving food-service jobs for nursing and IT.

Japan expects to have a shortage of 690,000 care workers by 2040, a tough gap to fill given the rapidly ageing population.


OECD data put Japan’s hourly labour productivity at $47.9, making it about 60% of the United States’ level, the worst among the Group of Seven (G7) advanced economies, and 21st

among the 37 OECD members as of 2019.

And the prospect of people being stuck in low income jobs poses a big challenge for Japan’s new Prime Minister Fumio Kishida, who has pledged to bring more wealth to households via higher wages.

“COVID-19 fallouts are pushing low-paid workers into even harder situations with little, or no, increase in pay,” said Hisashi Yamada, senior economist at Japan Research Institute.

Hospitality businesses have laid off workers, with the number of employees falling to 3.9 million in 2020 from the prior year’s 4.2 million, labour ministry data shows.

By contrast, the medical and health industry saw employees hitting 8.6 million, up 200,000 from 2019. The IT sector hired 2.4 million employees, up 100,000 from 2019.


Vocational training schools have benefited.

SAMURAI, which offers IT training, had 1.7 times more students enrolled as of April 2021 compared with a year earlier, as employees retrenched during the pandemic rushed to retrain.

Most IT jobs on offer for inexperienced workers are for programmers, on the lowest rung of the IT ladder, but they generally still pay more than can be earned in hospitality.

The average annual salary for employees at restaurants and nursing homes amounts to roughly 3 million yen, 30% less than an average Japanese workers’ salary, government data shows. IT programmers earn close to the national average.

“I saw how popular the IT sector was and thought I may land a stable job,” said Koki Shimizu, a 22-year-student at SAMURAI who lost his job as a chef and now is learning to program.

At Crie, which offers training in nursing care, classes that were only two-thirds full before the pandemic are now packed out.

The company’s head Takayuki Nakayama expects the uptrend to continue given steady job offers in the nursing care industry.

“It’s true wages are relatively low in the nursing-care industry. But many job-seekers want stability after seeing the damage inflicted on eateries and other service-sector firms.”

Retailers are also becoming alarmed over losing staff, as they are counting on a rebound in activity as Japan gradually eases COVID-19 restrictions.

Major Japanese pub chain operator Watami is scrambling to hire 100 mid-career staff this year – something it has not done for three years – and it reckons that eventually it may have to pay more.

“1,000 yen per hour may not be enough, 1,500 yen may be needed to attract workers in the future,” said the company’s chief executive Miki Watanabe.

For now, firms are wary of raising pay as the economy is still struggling in the wake of the pandemic.

($1 = 114.0100 yen)


(Reporting by Tetsushi Kajimoto; Editing by Leika Kihara, David Dolan & Simon Cameron-Moore)

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Pfizer-BioNTech report high efficacy of COVID boosters in study – Al Jazeera English



The companies say phase III trial data show booster shot of COVID-19 vaccine was 95.6 percent effective against the disease.

American pharmaceutical company Pfizer and its partner BioNTech have said data from a Phase III trial demonstrated high efficacy of a booster dose of their COVID-19 vaccine against the coronavirus, including the Delta variant.

They said a trial of 10,000 participants aged 16 or older showed 95.6 percent effectiveness against the disease, during a period when the Delta strain was prevalent.

The study also found that the booster shot had a favourable safety profile.

Pfizer had said its two-shot vaccine’s efficacy drops over time, citing a study that showed 84 percent effectiveness from a peak of 96 percent four months after a second dose. Some countries had already gone ahead with plans to give booster doses.

The drugmakers said the median time between the second dose and the booster shot or the placebo in the study was about 11 months, adding that there were only five cases of COVID-19 in the booster group, compared with 109 cases in the group which received the placebo shot.

“These results provide further evidence of the benefits of boosters as we aim to keep people well-protected against this disease,” Pfizer CEO Albert Bourla said in a statement.

The median age of the participants was 53 years, with 55.5 percent of participants between 16 and 55 years, and 23.3 percent at 65 years or older.

The companies said they would submit detailed results of the trial for peer-reviewed publication to the US Food and Drug Administration (FDA), the European Medicines Agency, and other regulatory agencies as soon as possible.

The US and European regulators have already authorised a third dose of COVID-19 vaccines by Pfizer-BioNTech and Moderna Inc for patients with compromised immune systems who are likely to have weaker protection from the two-dose regimens.

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A bag of peanuts and $70M, please: B.C. woman recalls spur-of-the-moment decision to buy winning Lotto ticket –



A Burnaby, B.C., woman who just won the largest Lotto Max draw in the province’s history says she made the decision to buy her winning ticket on the spur of the moment.

Christine Lauzon purchased the ticket for the Sept. 28 draw alongside a pack of peanuts at the Shoppers Drug Mart on Hastings Street in Burnaby, according to the B.C. Lottery Corporation.

“I just thought, ‘Why not buy a ticket?'” Lauzon said.

Lauzon said she has dreamed about winning Lotto Max from time to time, but never thought it would actually happen.

She said she checked her ticket at home, then shared the news with her roommate, and then her father.

“They were both so surprised and excited,” she recalled. “My dad … couldn’t keep a straight face.”

Lauzon said the experience has been surreal, but once her feet are back on the ground, her first priority is to connect with her financial advisor.

She said she plans to gift some of the prize to her immediate family.

“I can’t fully wrap my head around it all right now,” she said. “I am so excited for what is to come.”

Lauzon says she has a lot of ideas and causes that are close to her heart, and she will take her time before deciding how she will make an impact.

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