The dollar strengthened by nearly 2.5% year-to-date with expectations that the rise in US bond yields will weigh on stretched equity valuations. In addition, the rise will boost demand for the U.S. currency. The USD fell by 4% in the last quarter of 2020.
On Monday, the USD hit a 3-1/2 month high as the rising U.S. Treasury yields pushed investors towards the safe-haven currency.
Last month non-farm payrolls surged by 379,000 jobs. Moreover, the U.S. Senate approved President Joe Biden’s $1.9 trillion recovery package.
Marios Hadjikyriacos, an investment analyst at XM said, the U.S. labour market is healing quickly. He said that President Biden’s gargantuan relief package has been approved by the Senate.
America has stepped up its immunization game and is administering a record number of vaccines this weekend, Hadjikyriacos added.
U.S. yields climbed a one-year high above 1.62% on Friday. But German yields dipped nearly 5 basis points last week. This is pulling the euro to a near four-month low below $1.19.
BofA analyst Athanasios Vamvakidis said the U.S. stimulus, faster reopening, and greater consumer firepower was a clear positive for the USD.
The dollar index stood at 92.30 up 0.4%, its highest level since late-November.
With antipodean currencies, the AUD weakened 0.3% to $0.7658, while the New Zealand dollar shed about 0.8%.
The two have been in demand because of their links to global commodities trading. However, the dollar’s bounce dented both.
At $1.3819, the greenback held near a one-month high against the British pound. Against the Japanese yen, the USD held firmer at 108.56 yen, after hitting a nine-month high of 108.645 Friday.
Meanwhile, the USD gained in early European forex trading on Monday. Its three-month highs came after the passage of the massive Covid-19 relief bill through the Senate. This added to a strong U.S. labor market report in nurturing expectations of a strong recovery this year.
The Dollar Index was up 0.2% at 92.168, at 3:55 AM ET (0755 GMT). It was near its three-month high of 92.201 set on Friday.
The EUR/USD pair lost 0.2% to 1.1888, just off a three-month low. The GBP/USD pair also shed 0.2% to 1.3813, near a one-month low.
USD/JPY added 0.3% at 108.45, just off a nine-month high. The risk-sensitive AUD/USD edged down 0.1% to 0.7682.
Key Points: US economy growth slowed to 1.6% in Q1, below the expected 2.4%. Consumer spending growth tapered, but business…
Key Points: Microsoft's რevenue surged to $61.9 billion, a 17% increase driven by robust sales in all business segments. Notable…
Key Points Ethereum is Trading below $3,180, under the 100-hourly SMA, indicating a cautious market trend despite the formation of…
Key Points Oil Prices rose, Brent crude oil reached $89.32 per barrel, up 2%, and WTI at $83.86, up 0.5%.…
Key Points GBP/USD is currently at 1.2502, impacted by UK-US economic turbulence and monetary policies. US Q1 GDP growth at…
Key Points: Despite global volatility, USD/INR is the least volatile major currency in FY 2023-24, supported by interbank USD sales…
This website uses cookies.