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Euro Sinks, US Greenback and Yen Surge as S&P Cuts Russia Ranking to “Junk”


EURO, US DOLLAR, YEN, RUSSIA, UKRAINE, SANCTIONS, S&P – TALKING POINTS:

  • Euro sinks as Western powers dial up sanctions towards Russia
  • S&P cuts Russia credit standing to “junk”, Moody’s set to comply with
  • Aussie Greenback down, Yen and Franc up in risk-off buying and selling open

The Euro sank on the weekly buying and selling open, shedding over 1 % towards the anti-risk US Dollar and Japanese Yen, after Western powers sharply stiffened sanctions against Russia to punish it for the invasion of Ukraine. A partial ban on Russian entities’ use of the SWIFT financial institution correspondence system was accompanied by the much more dramatic freezing of the property of the Central Financial institution of Russia.

These actions dramatically disrupt Russia’s entry to the worldwide monetary system, disabling the CBR from defending the freefalling Ruble in addition to chopping off the federal government from cross-border purchases and financing. Russia’s credit standing was promptly minimize to “junk” by S&P World Scores, citing the “robust” sanctions. Moody’s Investor Service – one other prime rankings company – put Russia on evaluate for a downgrade.

Threat urge for food understandably collapsed as markets grappled with uncertainty about what’s to return subsequent. The Norwegian Krone and Swedish Krona suffered outsized losses given their residence nations’ proximity to the disaster in addition to their position in the regional economy. The equally sentiment-sensitive Australian and New Zealand {Dollars} additionally fell. A quiet Monday on the APAC knowledge docket provides little to disrupt the risk-off drive forward.

Euro Sinks, US Dollar and Yen Surge as S&P Cuts Russia Rating to “Junk”

USD, CHF, JPY vs. AUD, EUR – chart created with TradingView

FX TRADING RESOURCES

— Written by Ilya Spivak, Head of Larger Asia at DailyFX.com

To contact Ilya, use the feedback part under or @IlyaSpivak on Twitter





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