FX Action: The dollar has extended lower
FX Action: The dollar has extended lower, with the USD index (DXY) having racked up a 0.4% decline, presently at 89.81, which is 4 pips above the low, which is a four-session nadir. The buck's biggest loss has been against the yen, having shed 1%, which is more than double the decline the dollar has seen so far versus the euro and Swiss franc. USD-JPY clocked a low at 107.53 earlier, which is a five-month low. Last September's low at 107.31 is now in focus. Buying around 108.00 was quickly absorbed, and a series of sell stops were reportedly triggered under the figure. The yen's outperformance appears to be tracking losses in U.S. stock futures. S&P 500 futures are presently showing a 0.6% decline, extending from the modest 0.2% decline that was seen earlier at the London open and pointing to opening losses on Wall Street yesterday. This follows the best two-day rally in over two years, which in turn follows the worse weekly performance two years. The price action accords with the narrative that global markets have entered an era of heightened volatility.