Positive sentiment on vaccine rollout and lifting of lockdown weakens safe-haven currencies
The dollar weakened this morning along with the Swiss franc and Japanese yen as investor sentiment turned positive. President Biden's pledge to vaccinate 200M Americans within the first 100 days in office supports the view of a stronger US economy. Also, the Federal Reserve announced banks that pass stress tests can pay dividends again after mid-year and Germany withdrew Easter lockdown restrictions.
March 26, 2021
EUR/USD 1.1785 GBP/USD 1.3791 USD/CAD 1.2567 AUD/USD 0.7626 USD/JPY 109.78 USD/CNH 6.5391 USD/ILS 3.3323 USD/MXN 20.5833 USD/CHF 0.9414 USD/INR 72.5075 USD/BRL 5.6958 USD/SGD 1.3463 USD/DKK 6.3099 USD/SEK 8.6459 USD/NOK 8.5895
The dollar is weaker versus commodity currencies, along with the pound and euro, but gained versus other safe-haven currencies such as the Japanese yen and Swiss franc.
The PCE Deflator for February came in at 1.6% YoY which was in line with expectations. When inflation data for March is released later next month expect stronger inflation growth compared to prior year when the pandemic led to a global lockdown.GBP
The pound rebounded from some of its recent losses as February retail sales strengthened. The volume of goods sold in shops and online rose 2.1% from January - sales excluding auto fuel climbed 2.4%. GBPUSD has gained 0.76% over Thursday's trading and into this morning, whilst GBPEUR gained almost 1% over the same period.EUR
The euro sunk overnight to its weakest level versus the US dollar in 4 months and then rebounded strongly as the New York trading session begins. Overall risk-on hurt the dollar.CAD
The Canadian dollar bounced back after yesterday’s losses reflecting the oil price which is also higher this morning. Some traders see the Canadian commodity complex gaining should the US undertake a massive infrastructure spend. Also, the Bank of Canada meets next month and there is some market speculation the Canadian central bank may discuss tapering its quantitative easing measures; A move determined to be bullish for the loonie.ASIA/PACIFIC
The Japanese yen is trading at the weakest level in a year as safe-haven currencies sell off. Higher commodity prices lift the Australian dollar.
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