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The U.S. dollar was mostly steady, mirroring the action overnight in China where both stocks and the yuan eked out gains. Underlying market sentiment remained very fragile, particularly with oil on the defensive at 12-year lows below $32. The dollar has wavered out of the gates this year as pressures from global instability and falling oil prices suggest less leeway for the Federal Reserve to raise U.S. lending rates. The dollar has firmed this week against the euro but it remains below the one-month highs it notched a week ago. Sterling plunged to new five-year lows after disappointing U.K. factory data hinted at a further loss of economic momentum, reinforcing expectations the Bank of England on Thursday would maintain record low rates to keep its recovery intact. Like oil, Canada’s dollar remained on flimsy ground like quicksand, hitting May 2003 lows.

EUR

A tentative calm in global financial markets amounted to diminished deman for the low-yielding euro. A better market mood leaves the euro vulnerable as it tends to entice traders to sell the cheap euro for higher yielding, riskier bets. But with global risks dominating trade and casting fundamentals to the side, scope for euro weakness could prove limited.

GBP

Both the U.K. and Canadian currencies appeared in a footrace to 1.43 against the U.S. dollar. Sterling fell toward that level, hitting fresh 5-year lows in the process, after disappointing U.K. factory news offered scope for the Bank of England to conclude its first meeting of the year on Thursday in dovish fashion. The 0.7 percent slide in industrial production in November was the most in nearly two years and flew in the face of forecasts of unchanged.

ZAR

Round up the rand buyers – they are reaping the best market to take some cover ever. South Africa’s currency crashed to record lows this week, hit by economic uncertainty at home and in key export market China.

CAD

A volatile Canadian dollar fluctuated to a gain as it continued to ride shotgun to oil which tentatively climbed into positive territory. Currencies from Canada and Britain appear in a footrace to 1.43 with the former coming within a cent of that level overnight when it notched fresh 12-year lows. The outlook remains decidedly bearish for the loonie because once global uncertainties diminish, the loonie would see its weak fundamentals hold sway. Jan. 20 looms as a critical risk event for the loonie, the day the Bank of Canada announces its first policy decision of the year.

USD

Diminished risk aversion buoyed the dollar, tempting traders to dip a toe into riskier waters that offer better yield potential. Many expect the dollar to outperform this year with the Fed penciling in a quartet of rate hikes in 2016. However, with global turmoil dominating trade in the early stages of the year, it has partially put on ice America’s bullish narrative, allowing low yielders and safe havens with checkered fundamentals, like the euro and yen, to shine.

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