Dollar surges as global growth fears increase

Market reports
Thanim Islam
  • GBP slide continues
  • EUR falls as rate hike support diminishes
  • USD Fed Chair Powell takes centre stage at Jackson Hole symposium


Early morning optimism boosted by a surge in global equity markets quickly faded as higher long term bond yields once again rekindled global growth fears. Safe haven flows into the $ saw the dollar basket rise to a 2-month high. Recessionary worries were accentuated late in the session after the US Treasury stated the Chinese economy is showing weakness that has global implications, adding, the US is probably best prepared to deal with the headwinds created by Chinese economic weakness, but they are concerned about developing economies, and those in Asia and Europe that are reliant on the Chinese economy for growth.


Market rates

* Daily move - against G10 rates at 7:30am, 25.08.23

** Indicative rates - interbank rates at 7:30am, 25.08.23

Data points


  • USD - Fed Chair Powell
  • EUR - ECB President Lagarde

Our thoughts

The dollar continues to remain the markets currency of choice, as higher longer term interest rates and global recessionary fears weigh heavily on broader market sentiment.  

Today sees the start of the Jackson Hole symposium where key central bankers from the US, EU, Japan, and the UK are due to speak on the economy.

Markets keenly await US Federal Reserve Chair Powell’s speech (due at 15:05) in particular for clues as to whether interest rates will remain higher for longer. Should he indicate so, we expect the recent $ rally to continue. ECB President Lagarde (due at 20:00) is likely to maintain their data dependency stance.

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