The U.S. dollar gained massively versus the euro and most of the 16 main traded currencies as risk aversion rose sharply in the beginning of the day as the IMF stated that the global economic recovery will be sluggish, attracting traders to the safety of the greenback.
After the International Monetary Fund statement today affirming that the economic rebound will be a slow and complicated process, the U.S. dollar found grounds to rise significantly together with the Japanese yen, as both currencies are considered the best safe refuge investments for turbulent times. Several U.S. economic data reports were published today mostly showing results below forecasts, which added pessimism today in an already bearish scenario of weak stocks performance, giving a breather for the U.S. dollar that gained distance from the $1.50 level versus the euro, being trading around the $1.45–1.50 band since the beginning of September.
The economic recovery process will be long, and it can be even considered that the global economy will not see a such a fast growth as the one experienced before the crisis for the next decades. The dollar is still on the pressure but, despite that, eventual days of pessimistic news are likely to maintain the dollar in a slow decaying trend, not as fast as many currency specialists suggested.
EUR/USD traded at 1.4834 as of 16:12 GMT from a previous rate of 1.4972 i the intraday. USD/CAD traded at 1.0591 from 1.0442.
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