On Tuesday, the U.S. Dollar plunged. Why’s that?
On Tuesday, the sentiment in the forex markets improved dramatically. The U.S. Dollar was sent into the red on Tuesday. Investors worried that the collapses of two U.S.-based regional banks would be the beginning of a global financial crisis. These fears were somewhat alleviated today. The demand for safe-haven currency also declined.
Despite this, the Japanese currency yen remains high. Japan’s fiscal year ends on Friday, and flows are picking up. The currency is continuing to rally as a result. On Tuesday, the greenback fell to 130.51 Japanese yen. The greenback was last seen trading lower at 131.2, down 0.29%. The U.S. dollar rose by 0.64% during the previous session before falling some of these gains today.
Economists believe that Japanese companies will seek foreign bonds to improve their balance sheets. Bart Wakabayashi, the branch manager at State Street in Tokyo, noted that at the end of the Japanese fiscal year, it’s natural to expect more flows.
The euro and the British Pound soared in Europe as the dollar fell. First Citizens BancShares announced that it would buy all of collapsed U.S. lender Silicon Valley Bank’s loans and deposits. Investors were energized by this news.
