Forex – Dollar on the other hand, as caution Dominates

© Reuters. Dollar remains lower compared to other majors, the North Korean threats weigh – The U.S. dollar against other major currencies on Friday, as concerns over fresh tensions between the United States and North Korea weighed on the market sentiment.

Had the dollar strengthened broadly after the Fed indicated on Wednesday that a further interest rate increase is likely this year and said it will begin to relax $4.5 trillion balance sheet in October.

But the market sentiment was hit after the North Korean leader, Kim Jong-Un, said on Friday that Pyongyang about the “highest level of hard-line action in history” against the United States in response to President Donald Trump’s threat to destroy the country.

Shortly after North Korea’s foreign Minister Ri Yong Ho said his country could fuel the implementation of a water-bomb test in the Pacific ocean of an unprecedented scale.

In his first speech before the General Assembly of the United Nations on Tuesday, Trump said: “the United States has great strength and patience, but to defend if it is forced themselves and their allies, we have no choice, but to destroy completely, North Korea.”

The safe-haven yen and Swiss franc were higher, with USD/JPY sliding 0.41% 112.01, from the previous session, the two-month-high of 112.72, while the USD/CHF 0.21% fell in the trade 0.9687.

Elsewhere, EUR/USD up 0.20% to trade 1.1965 won, while GBP/USD at 0.10% and declined to 1.3569, starting on Monday in the 15-month high of 1.3620.

The euro was reinforced by the data earlier published Friday by the research group Markit, the manufacturing and the service sector activity in the euro-zone advanced more than expected this month.

Market participants were looking to a speech by the British Prime Minister, Theresa may, is planned later in the day.

Reports earlier in the week indicated that the UK would be prepared to pay €20 billion for a two-year transition period after Brexit.

The Australian and new Zealand dollars were stronger, with AUD/USD up 0.47% at 0.7968 and with NZD/USD up 0.22% to add to 0.7323.

Meanwhile, USD/CAD 0.44% to 1.2273.

The US dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.22% 91.77 08:10 PM ET (12:10 GMT) Thursday, a week with highs of 92.42.

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