Optimism concerning the re-opening of economies hit by the coronavirus pandemic boosted risk appetite. It lifted the commodity currencies such as the Norwegian krone. Thus, on Monday, the dollar edged down.
There are fresh trade tensions between China and the United States. Nevertheless, the gradual easing of lockdowns fueled optimism around global markets.
Adam Cole is a chief currency strategist at RBC Capital Capital Markets. He said that overnight, markets are quickly risk-on.
The dollar index decreased by 0.05% at 100.28. Moreover, rising oil prices lifted the Norwegian krone. It was supported by sings of a recovery in demand and output cuts.
The krone jumped 0.6% to 10.1860 against the dollar. Other currencies of the commodity also rose. Moreover, in over seven years, gold gained more than 1% to its highest.
Stock gains lifted other major currencies, for example, the Australian dollar.
The Australian dollar was up by 0.5% at $0.6446. The common currency increased by 0.05% to $1.0827.
The Dollar and Others
The United States currency lost about 0.2% at 107.20 per dollar against the yen. It happened after the data showed that Japan, for the first time since 2015, slipped into recession. Policymakers braced for the worst postwar slump of the nation.
Later this week, for the next insight into the outlook, investors were also looking for Purchasing Managers’ Index surveys across significant economies.
The pound had a week-long deadlock over a post-Brexit trade deal with the European Union. Moreover, there was an increased focus on the possibility of negative rates. Thus, the pound was under pressure at $1.2107 and stood at 89.35 pence per euro.
Andy Haldane is the Bank of England’s chief economist. He said he did not rule out such a move during the interview published on Saturday with the Telegraph newspaper.
It is the leading news for now. All in all, it looks like the economy is getting back to shape, but with plodding steps.
- Trading Instrument