Morning Bid: Global business splutters, dollar surges

While strategic competitors in emerging markets are calling for change and the share of the US dollar held as official foreign exchange reserves has declined, it is unlikely that there will be a major shift in the US dollar's role as the central global currency due to the stability and reputation of the US government, as well as the challenges and limitations of other options like the renminbi.

The US dollar remains strong against major peers and the yen, as Treasury yields rise amid expectations of high US interest rates for a longer period, while China's central bank sets a stronger-than-expected daily midpoint for the yuan to counter mounting pressure on the currency.

A group of developing countries known as BRICS, including Brazil, Russia, India, China, and South Africa, is determined to challenge the dominance of the US dollar in global finance and trade through the process of de-dollarization, which they believe is irreversible and gaining pace. The shift away from dollar dominance is driven by recent geopolitical tensions and the desire to have more choices in global financial interactions, rather than being anti-West or anti-dollar. However, experts believe that the dollar will remain the dominant global currency for the foreseeable future.

The US dollar will remain dominant in global trade, but China's yuan is gaining popularity among developing countries such as Russia, Brazil, India, and South Africa.

The US Dollar performed well against major currencies, with the British Pound, Euro, and Canadian Dollar underperforming, while the Chinese Yuan and Australian Dollar fared better; the Federal Reserve's indication of a higher terminal rate and potential further borrowing cost increases contributed to the market sentiment, leading to lower US equity markets; upcoming economic data includes consumer confidence, inflation gauges from key European countries, and manufacturing PMI gauges from China.

The US Dollar is facing profit-taking and risk as traders digest the Jackson Hole speech and push back expectations for rate cuts, while upcoming macroeconomic data points will be closely watched for any signs of economic deterioration.

The US dollar experienced a major technical reversal due to a weaker JOLTs report, leading to a drop in US interest rates, while market positioning played a role in the price action; the focus now shifts to personal consumption figures and US jobs data, with the euro and sterling firm but most other G10 currencies softer, and emerging market currencies mixed. In Asia, most large bourses advanced, but Europe's Stoxx 600 fell after rallying in previous sessions, while US index futures traded softer; European bonds are selling up, gold is consolidating, and oil prices are firm. Australia's CPI slowed more than expected, China is expected to release the August PMI, and Japan reports July retail sales. The US dollar has seen no follow-through selling against the yen, yuan, or Australian dollar, while the euro and sterling staged impressive price action. The JOLTS report saw the dollar and US rates reverse lower, and today the US reports advanced merchandise trade figures for July, with the Canadian dollar as the worst performing G10 currency yesterday.

The Canadian dollar strengthens slightly against the US dollar in August despite concerns about China's economy and a decline in commodity-linked currencies.

Despite the divergence in global economies, the US dollar still remains dominant, holding a record-high share of 46% on SWIFT in July, while the euro's share slipped to a record low.

The dollar's status as a global reserve currency is facing challenges as countries like China and India promote trade in their own currencies, digital currencies gain popularity, and geopolitical conflicts threaten the international monetary system dominated by the dollar.

The US dollar weakened against major counterparts due to disappointing economic data, leading to a rally in gold prices and a less dovish Federal Reserve outlook, while the Australian and New Zealand Dollars performed well due to gains in Wall Street; crude oil prices also rallied despite deteriorating economic conditions in China.

The US dollar's influence in the oil markets is diminishing as more oil is being transacted in non-dollar currencies, according to JPMorgan.

The dollar has reached a five-month high as investors anticipate the need for elevated interest rates due to the strong US economy, with factors such as weak growth in China and Europe, rising US yields, and falling equity prices further supporting the case for dollar strength.

The rising U.S. dollar is causing concern among foreign officials and investors, but it remains uncertain if anything can be done to stop its rise or if it will negatively impact U.S. equities.

The dollar's strength is expected to be difficult to overcome for most major currencies by year-end, according to a Reuters poll of forex strategists, with risks to the greenback outlook skewed to the upside.

The U.S. dollar's share in global reserves has fallen below 60% for the first time in decades, as other currencies like the Euro, Pound, and Yen are on the rise due to a growing number of countries settling trade in their national currencies, driven by the de-dollarization process initiated by BRICS to end reliance on the U.S. dollar.

The dollar strengthens against the yen and keeps the euro and sterling near three-month lows as investors rely on the resilience of the U.S. economy, while China's onshore yuan hits a 16-year low due to a property slump and weak consumer spending.

The US dollar is on track for its longest rally in years as the strength of the economy fuels speculation that the Federal Reserve will keep interest rates elevated, drawing money into the US as investors seek higher rates than they can get in Europe and Asia.

The value of the U.S. dollar has been strengthening against the Euro and the British Pound due to the continuing strength of the U.S. economy and the weakness of the European economies.

The US Dollar performed strongly against major currencies, with the Euro experiencing its 8th consecutive weekly loss and the Chinese Yuan performing poorly, while global market sentiment was negative and stock markets weakened. In the coming week, market focus will be on the US inflation report, UK employment and GDP data, Australian employment data, and the ECB rate decision.

The US dollar's dominance as the world's reserve currency is at risk due to growing debt in the US, according to economist Barry Eichengreen, highlighting the importance of controlling debt to maintain the dollar's global role.

The Indian Rupee is weakening against the US dollar, causing concern for Indian authorities who fear that it could impact the country's import and export sectors, with suspicions that India may be taking measures to limit the dollar's growth; similarly, other BRICS member countries like China and Japan are also trying to curb the US dollar's growth.

The US Dollar underperformed against major currencies last week, crude oil continued to rally, and gold prices were cautiously higher, while upcoming events like central bank rate decisions and the Bank of England rate hike are expected to impact the market.

European markets are pessimistic ahead of central bank meetings, energy prices raise the risk of secondary inflation, and the US dollar is gaining strength, which may negatively impact precious metals and cryptocurrencies.

The US dollar remained strong against other currencies as traders awaited the Federal Reserve's rate decision, while the yen hovered near a 10-month low amidst speculation of intervention.

The BRICS bloc, including countries like India, China, and Russia, is slowly reducing its dependency on the US dollar and using their local currencies for trade, which could potentially weaken the US dollar's position as the dominant global currency.