By Peter Nurse
Investing.com – The dollar loses positions this Friday, weighed down by gains in the yen and the Swiss franc, two currencies considered safe havens, as traders ditched riskier currencies after discovering a highly mutated new variant of the coronavirus.
At 8:55 a.m. (CET), the, which follows the evolution of this currency against a basket of six other major currencies, fell 0.2%, to 96.635, departing from the highs recorded on Wednesday at 96.938, its highest level since July 2020.
The pair is down 0.7% to 114.52 and down 0.6% to 0.9307 as traders turn to the traditional safe havens of the Japanese yen and Swiss franc following the announcement of a new variant of Covid-19 that has mutated so much from the original strain that it could be resistant to vaccines.
On the other hand, the pair rises 0.3% to the level of 1.1240 and it falls 0.2% to 1.3300.
The World Health Organization has announced that it will hold an emergency meeting on Friday to discuss the implications of the treatments following this discovery. Although the degree of virulence of the new strain is not yet clear, it is the first that has been shown to be competitive with the Delta variant, responsible for the majority of infections this year.
The UK Health Security Agency has said that the variant, called B.1.1.529 or nu, has a completely different viral spike from the original coronavirus, for which the current generation of Covid-19 vaccines is designed. .
Although the dollar has fallen, the worst hit currency has been the South African rand, as the variance was first detected in South Africa, and the pair rose 1.6% to 16.2171, highs of more than a anus.
The highly risk-sensitive Australian dollar was also affected, with the pair hitting three-month lows, falling 0.8% to 0.7130, despite Australian retail sales growing 4.9 % MoM in October, higher than expected. The New Zealand dollar followed suit, falling 0.7% to 0.6811, also a three-month low.
“People are reacting to the uncertainty around what this means. When this kind of news comes out, it first triggers and then wonders,” said Ray Attrill, head of currency strategy at the National Bank of Australia in Sydney. according to Reuters.
That said, it has risen around 0.6% for the week as a whole and is on its way to its fifth consecutive weekly rise. Traders are in favor of the Federal Reserve starting to raise interest rates in the middle of next year, while central banks in Europe, Japan and other countries are more moderate.
The president of the ECB, Christine Lagarde, will appear in the course of this day, and last week she retracted the idea of raising the rates of the eurozone soon. Furthermore, the minutes of the last central bank meeting suggest a cautious approach to any change in monetary policy.