Euro US Dollar Exchange Rate Passes Key Resistance Level in Upbeat Trade

Pound (GBP) Surges amid Positive Sentiment

The Pound struck higher through yesterday’s trading session, with the currency largely riding the wave of optimism which swept through markets at the start of the week.

This jump in Sterling sentiment was also aided by the UK’s recent reopening of a large portion of its economy, which reaffirms hopes for a strong rebound in domestic growth over the summer.

Meanwhile, the Pound may look to extend these gains today after the UK’s latest jobs report beat expectations, with a surprise drop in the unemployment rate in February.

Euro (EUR) Rallies amid USD Selloff

The Euro struck higher on Monday as the single currency was bolstered by a drop in the US Dollar due to the negative correlation between the pairing.

Also supporting the Euro was optimism over the continued acceleration of the EU’s vaccine rollout as well as improving European coronavirus statistics.

In the absence of any notable Eurozone data today, the lack of fresh impetus could cause the single currency to struggle to extend its gains.

US Dollar (USD) Tumbles in Upbeat Trade

The US Dollar started poorly this week, with the ‘Greenback’ plunging to a one-month low as demand for the safe-haven currency was undermined by a prevailing sense of economic optimism.

Equity markets surged and US Treasury yields slumped as investors grow increasingly optimistic over the chances of the global economy rebounding swiftly in the coming months.

Looking ahead, with the outlook growing increasingly positive it’s likely the US Dollar will remain on the back foot through today’s session as well.

Canadian Dollar (CAD) Undermined by Domestic Coronavirus Surge

The Canadian Dollar weakened on Monday in response to growing concerns over a resurgence of coronavirus cases in parts of Canada.

New stricter restrictions have been put in place in the province of Ontario as experts warn infections could increase by up to 600% by June.

Australian Dollar (AUD) Strengthens in spite of Dovish RBA Minutes

The Australian Dollar accelerated overnight on Monday as the risk-sensitive currency continued to benefit from the positive market mood.

However, these gains were tempered somewhat by the minutes from the latest Reserve Bank of Australia (RBA) policy meeting, in which the central bank reiterated its commitment to provide ‘highly supportive’ monetary conditions.

New Zealand Dollar (NZD) Bolstered by Risk-On Trade

The New Zealand Dollar also struck higher in overnight trade as investors favoured the ‘Kiwi’ amidst the improving market sentiment.

Looking ahead, the publication of New Zealand’s latest quarterly CPI figures could further buoy NZD exchange rates later this afternoon if domestic inflation accelerated as expected in the first quarter of 2021.

Matthew Andrews

Contact Matthew Andrews