The U.S. Dollar, Euro, and Other News of the Forex Market

The U.S. Dollar, Euro, and Other News of the Forex Market

Against a basket of currencies, the United States dollar rose around 0.3%. It weakened in the last week because global markets grew more optimistic concerning economic recovery. Nevertheless, in overnight trading, the United States currency started to strengthen. Nonetheless, it picked up more sharply from around 0600 GMT.

The safe-haven Japanese yen decreased to new two-month lows. Thus, at 0710 GMT, it was down around 0.1%. Moreover, it weakened to as much as 109.150 overnight before steadying in early trading of London.

From recent highs, riskier currencies treated. Against the United States dollar, the dollar of Australia fell as much as 0.5%, hitting a low of $0.6884.

In April, Australian retail sales suffered a historic plunge. Meanwhile, the surplus of trade narrowed because the coronavirus battered the economy. Thus, in the current quarter, it left the nation facing its worst-ever contraction.

The crown of Norway edged down against the euro and dollar from recent three-month highs.

Dollar and Others

In a note to clients, Goldman Sachs analysts recommended that investors go short on pair of USD/NOK.

They wrote that currency is offering attractive exposure to several cyclical factors. Those factors seem to turn to tailwinds from headwinds, such as improving growth in Europe and higher oil prices.

On Thursday, the dollar strengthened. Thus, it reversed the weakening trend taking place in the past seven days. Ahead of a European Central Bank meeting, the euro slipped. Policymakers could step up the discussion of stimulus measures at that meeting. Most probably, the European Central Bank will increase the site of its Pandemic Emergency Purchase Program. That is to support the weakest economies of Europe. Nonetheless, some investors think that it will happen at the meeting in July rather than today.

Adam Cole is chief currency strategist at RBC Capital Markets. He said that the implications of increasing the size of the euro are limited.

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