Connect with us

Hi, what are you looking for?

BUSINESS NEWS

Dollar Rises Amid Global Cyber Outage Affecting Banks and Airlines

The dollar strengthened during volatile trading on Friday as a global cyber outage disrupted banks, airlines, and broadcasters, unsettling investors. Despite this, currency market volatility remained limited.

Disruptions became evident as trading began in London, one of the world’s busiest financial hubs. The LSEG Group, operator of the London Stock Exchange, experienced an outage affecting user access to some of its products.

By midday in Europe, the company reported that its services had been restored.

Also read: Zimbabwe Police Identify Chinese National Accused Of Torturing Local Mine Workers

Investor risk appetite has declined this week, significantly impacting technology stocks. Additionally, expectations of a potential rate cut from the Federal Reserve as early as September have weakened the dollar, particularly against low-interest-rate currencies like the yen and Swiss franc.

Advertisement. Scroll to continue reading.

The significant disparity between US interest rates and those in Japan and Switzerland has led investors to sell these currencies to fund purchases of higher-yielding assets like the dollar, tech stocks, and cryptocurrencies.

The yen also gained after suspected intervention by Japanese authorities last week, with continued caution on Friday.

“There is a bit of a carry unwind going on and the Swissie has traded notably firmer this week as well,” said Michael Brown, senior analyst at Pepperstone. “The carry unwind might be part of a broader momentum unwind we’re seeing – the tech sector has taken a hit in four out of the last five days as well.”

The yen, set for a 0.1 percent gain this week, weakened slightly to 157.485 per dollar after data showed Japanese inflation rose for the second consecutive month. The yen has fallen more than 10 percent against the dollar this year, primarily due to the wide interest rate gap between the US and Japan, hitting 38-year lows earlier this month, prompting intervention from Tokyo.

“While suspected interventions do not seem to stabilize the yen, we believe monetary policy might,” said Krishna Bhimavarapu, APAC economist at State Street Global Advisors.

Advertisement. Scroll to continue reading.

For comments, Feedback and Opinions do get in touch with our editor on WhatsApp: +44 7949 297606

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Catch More Updates Below

BUSINESS NEWS

Banks need to adjust their excessive charges as this is affecting financial inclusion in the country, a senior Government official has said. Speaking during...

WORLD NEWS

Rate shock” for British mortgage borrowers might not provide a boost for the banks Mortgage borrowers who were hoping for more affordable rates were...

Advertisement