USD Rage Back Crashes the Market!

<p>&nbsp;The US dollar continues to extend its rise higher after receiving support from 'risk aversion' in the market heading into the weekend.</p><p><br /></p><p>The European session saw the currency king stronger with the dollar index continuing to strengthen to a price level of 103.12, well off the one-month low of 101.92 it touched on Thursday.</p><p><br /></p><p>Investors see the strengthening of the US dollar as a 'delayed' reaction after Federal Reserve (Fed) Chairman Jerome Powell strengthened the central bank's position to continue raising interest rates.</p><p><br /></p><p>At the same time, the greenback also gained a boost as a safe-haven amid market fears of a recession after seeing weak manufacturing and services PMI data in the European Zone and the UK.</p><p><br /></p><p>The euro plunged lower after data released at the start of the European session showed the manufacturing sector fell to a 3-year low and services fell to the slowest since January.</p><p><br /></p><p><br /></p><p>While the pound also traded gloom following the release of data that saw a contraction in the manufacturing sector in June to a 5-month low and services to the slowest in 3 months.</p><p><br /></p><p>The weakness in the PMI data has pushed French and German 10-year bond yields down and also dragged the 10-year yield of the United States down to 3.74%.</p><p><br /></p><p>Investors are now turning their attention to the release of US manufacturing and services PMI data in the upcoming New York session.</p><p><br /></p><p>Following the greenback's strength, the Aussie, New Zealand and Canadian dollars also recorded significant declines as concerns dampened market sentiment.</p><p><br /></p><p>The yen continued to trade weaker at a 7-month low against the greenback, despite receiving temporary support early in the session due to falling US bond yields.</p><p><br /></p><p>However, compared to other major currencies, the yen strengthened as a safe-haven currency following risky market sentiment.</p>