The risk rout calms down ahead of North American trading
The greenback continues to lead the charge in the major currencies space but gains have been trimmed somewhat across the board as risk sentiment exudes some calmer tones.
The DAX fell by nearly 2% earlier in the session but has trimmed losses well beyond opening levels to be down by just 0.6% currently. Elsewhere, S&P 500 futures are down by 0.2% after briefly turning flat as compared to the roughly 1% drop earlier.
Of note, even the pickup in the VIX yesterday is starting to abate a little but it may still be too early to draw much conclusions until Wall Street enters the fray later.
The overall risk mood remains fragile still following the battering yesterday and while there are some calmer tones now, it may yet turn chaotic once again later in the day.
As for the dollar, it is mostly reacting to how risk sentiment is playing out over the past few sessions so expect more of the same ahead of the weekend.
EUR/USD is back to around 1.2100 levels while USD/JPY continues to flirt with a potential breakout. Meanwhile, AUD/USD continues to test support around 0.7600 and NZD/USD is just off earlier lows closer to the 0.7100 handle.
