Covid flaring up in China once again made it difficult to cope with current situations. There have been two deaths reported in Beijing on Sunday making it mandatory for people to stay at home.
The restrictions imposed on the citizens have made it difficult for China and are affecting the global economy too. This has helped the dollar get a boost and rise up.
“The outlook for China’s zero-COVID market will remain a key source of volatility,” said Carol Kong, a currency strategist at Commonwealth Bank of Australia.
The Federal Reserve is expected to hold back interest rate hikes due to a fall in inflation. The dollar index has slid by 6% from a 20-year high in October.
The aggressive raising of interest rates by the Federal Reserve has pushed bond yields which have sucked money back toward dollar-denominated fixed-income assets.
Elsewhere, cryptocurrencies remained under pressure, with bitcoin down 1.6% to $16,003. FTX owes its 50 biggest creditors nearly $3.1 billion, according to bankruptcy filings, as the collapsed crypto exchange undertakes a strategic review of its global assets.
Sterling was last trading at $1.182, down 0.51% on the day.
The Australian dollar fell 0.49% versus the greenback to $0.664, while the kiwi was down 0.44% at $0.613.
The investors are keen to know and track the policies of both the governments. The volatility of market and changes in dollar all depend on two factors i.e. Chinese alternatives for Covid and Policy of Federal Reserve towards the interest rate and recession. Thus, the two dynamic economies both suffering on their ends are yet to disclose their policies and measures as to how they will cope with their current situations and global economic trend.
