The US dollar index once again hit a multi-year high - 7.9.2022

The US dollar index rose on Tuesday. The increase continues and at the moment, it has made a new high since June 2002. This was facilitated by positive US economic data. ISM Non-Manufacturing PMI in August was better than expected and rose to 56.9 points. It is worth recalling that the ISM manufacturing indicator also increased last week. This is a sign that the US economy is growing faster than the economies of other countries. An important factor in the growth of the dollar index was the powerful weakening of the Japanese yen. USDJPY tested 144 yen per dollar this morning. This is the highest since August 1998. The main factor in the weakening of the yen was the announcement of representatives of the BoJ at a symposium in Jackson Hole that the loose monetary policy will continue. Recall that the BoJ rate is now negative and amounts to -0.1% with inflation in July +2.6% y/y. The next meeting of the BoJ will be on September 22. In addition to the yen, the weakening of the Chinese yuan continued this morning. This was facilitated by an unexpected decline in China's foreign trade surplus in August. The Australian and New Zealand dollars also made new lows this morning because their economies are linked to the Chinese economy.

Bitcoin is getting cheaper for the 3rd day in a row. For a month it collapsed by almost 20%. The main reason for this was the increase in electricity prices in almost all countries. This reduces the attractiveness of cryptocurrency mining. In addition, some environmentalists have criticized the mining of cryptocurrencies in a number of Western countries for its possible contribution to the global increase in carbon dioxide emissions. Mining in New York was limited this spring. Now the attention of crypto investors is focused on the Ethereum Merge process and its possible impact on quotes. Recall that the creators of Ethereum are going to transfer this cryptocurrency from the "Proof-of-Work" protocol to "Proof-of-Stake", which is considered more efficient.

Yesterday the American financial indices went down. Increasing activity in the service sector is, of course, a positive economic factor. However, it has the possibility of a high tightening of the Fed's monetary policy. Rising rates may increase the American credit corporation. revealing that yesterday's rise has become the S&P 500 Real Estate industry index. American real estate in demand amid high supply. The US Transportation Security Agency has announced the arrival of tourists until 2019. This frequent price growth occurs at Alaska Air Group (+0.7%), American Airlines (+1.8%) and United Airlines (+3.6%). This morning, futures for US economic indices are decreasing on the back of weak Chinese foreign trade data, as well as due to coronavirus restrictions in Shenzhen. Today the Fed's economic review Beige Book and trade balance for July will be released in the US.

On Tuesday, oil quotes fell. Now their decline continues. On Monday, OPEC+ decided to cut oil production by 100,000 barrels per day (bpd) from October. Probably, investors have decided that this is not enough to compensate for the risks of reduced demand against the backdrop of a slowdown in the global economy. China reduced oil imports in August by 9.4% y/y. Coronavirus restrictions in Chengdu may have contributed in part to this. An important negative factor for oil quotes are the plans of Western countries to reduce the cost of Russian oil in the framework of economic sanctions. Oil prices are supported by the reduction of U.S. Strategic Petroleum Reserve (SPR) to 442.5 million barrels. This is the lowest since November 1984. Weekly data on US stocks will be released today and tomorrow with a delay of 1 day due to a holiday on Monday (Labor Day).

The price of natural gas in Europe (TTF) today fell below $2,500 per thousand cubic meters. The support level is $2,000.