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2025-11-06 10:42:06
[Risk Sentiment Recovery Fails to Dispel Gloom, Pound Awaits Dovish Signal from the Bank of England] 1. The currency market saw a tug-of-war between bulls and bears on Thursday. The US dollar index, after hitting a multi-month high overnight, was capped by the 200-day moving average and is currently retracing to the 100 level, down about 0.1%. The temporary recovery in risk asset sentiment has curbed the dollar's upward momentum, but the strengthening of US Treasury yields continues to provide solid support for the dollar. Risk currencies saw a technical rebound. With easing selling pressure on tech stocks, the recovery in global stock markets pushed the Australian dollar back above 0.65 against the US dollar, currently trading around 0.6510, up about 0.1%; the New Zealand dollar also rebounded from a seven-month low to around 0.5665, up about 0.07%. Analysts pointed out that the market is sensitive to changes in risk appetite, but emphasized that for the dollar to show a trend of weakness, it still needs clearer signals regarding the US economic outlook. 2. Analysts pointed out that the fundamental support for the US dollar remains solid. Despite the government shutdown disrupting economic data releases and causing market decisions to falter, higher US Treasury yields continue to enhance the attractiveness of dollar assets. 3. The dollar is currently trading around 153.94 against the yen, down about 0.1%, but not far from Tuesday's near nine-month high of 154.48. The euro is hovering around the 1.15 level against the dollar, indicating that funds still tend to flow into dollar assets. 4. The currency market is focused on the upcoming Bank of England decision, with a widely expected dovish stance putting pressure on the pound. The pound is currently trading around 1.3060 against the dollar, up about 0.08%, after falling to 1.3008 overnight before rebounding to close at 1.3049. 5. Although the market expects the benchmark interest rate to remain unchanged at 4%, internal divisions within the policy committee and rising expectations of a rate cut early next year make this meeting fraught with dovish risks. Analysts warn that even if the rate remains unchanged, any signal hinting at a future rate cut could trigger a new round of declines in the pound. If the key support level of 1.30 is breached, the pound could test the April low of 1.2712.
