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Forex - Dollar slightly higher, yen underperforms after first debate

Published 09/27/2016, 08:47 AM
Updated 09/27/2016, 08:47 AM
© Reuters.  Dollar slightly higher, yen underperforms after first debate

© Reuters. Dollar slightly higher, yen underperforms after first debate

Investing.com - The dollar pushed higher against most of the other major currencies on Tuesday and the yen underperformed as investors digested the first U.S. presidential debate, amid the view that Hillary Clinton came out best.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.22% to 95.41.

Market sentiment was boosted after Monday's debate between the two presidential candidates suggested Clinton had boosted her chances over rival Donald Trump.

The safe haven yen underperformed, with USD/JPY subdued at 100.36.

The euro was weaker, with EUR/USD down 0.44% at 1.1203.

The Canadian dollar re-approached six-month lows, with USD/CAD rising 0.25% to 1.3257.

The loonie, as the Canadian dollar is also known, initially gained ground after the debate, but fresh falls in oil prices pressured the commodity linked currency.

The Mexican peso was the big gainer, with USD/MXN last down 1.63% at 19.55.

Canada and Mexico both have close trade ties with the U.S.

Traders were looking ahead to a speech by Federal Reserve Vice Chairman Stanley Fischer later Monday for hints on the timing of the next interest rate hike.

Expectations for a short term rate hike by the Fed have diminished since last week after the U.S. central bank hinted at one interest rate increase this year, but projected a less aggressive increase in rates next year and in 2018.

Expectations of higher interest rates typically boost the dollar by making it more attractive to yield seeking investors.

Sterling remained close to six-week lows, with GBP/USD at 1.2980 as speculation over a ‘hard Brexit’ continued to weigh.

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