The markets opened up more than 100 points in the first hour of trading as investors seem content to wait out the markets this week ahead of the Federal Reserve's September FOMC meeting, where the central bank will decide whether it will hike interest rates for the first time since 2006.
The dollar was once considered a safe-haven; however, during the recent bout of market panic, when stock markets like the Dax have had their biggest weekly decline since September 2011, the buck has had a torrid time versus other G10 currencies.
Traders are understandably focused on digesting yesterday’s less-hawkish-than-expected FOMC meeting as well as today’s Eurogroup meeting, which has been billed as the “drop dead” date in Greece’s debt negotiations, but we’ve also seen a major shift from Norway’s Norges Bank in today’s European session.
The yen fell to a seven-year low versus the dollar on speculation Japan’s Prime Minister Shinzo Abe is considering postponing a planned sales-tax increase and preparing to call a snap election next month.
It’s been a whirlwind of a morning for U.S. traders, who have been treated to four top-tier monetary policy decisions in last twelve hours (BoJ, Riksbank, BoE, and ECB), as well as some of the most reliable leading indicators for the U.S. labor market.