The dollar and yen held broad gains on Wednesday, as a bounce in oil prices failed to calm market nerves, with the week's rout and frail fuel demand underlining a grim outlook for the global economy.
The greenback sat just below a two-week peak against a basket of peers, and barely budged against commodity currencies whacked by the oil collapse, even as U.S. crude (CLc1) jumped 20%.
The safe-haven Japanese yen held at 107.83 per dollar and both the U.S. currency and yen were steady against the oil-sensitive Canadian dollar and Norwegian krone. The Australian dollar battled to pull ahead, but hit resistance around $0.6300.
The recovery in U.S. crude lifts it out of negative territory, but at just shy of $14 a barrel, it is still some 80% under January's peak as cratering energy consumption due to coronavirus lockdowns creates a supply glut.
The plunge has soured appetite for risk and seems to have halted a rebound in stock markets as investors brace for a longer and slower global economic recovery.
The greenback has gained half a percent this week on a basket of currencies and stands near multi-week highs against currencies of oil exporters such as Russia, Norway and Canada.
It advanced against most Asian currencies on Wednesday and gained most on the New Zealand dollar , rising about 0.3% to $0.5959 after the Reserve Bank of New Zealand's governor on Tuesday again raised the prospect of negative rates.
The euro remained rangebound, holding at $1.0856, while the British pound held near a two-week trough after a gloomy assessment of recovery prospects from the Bank of England's chief economist.
Source : Reuters