- Dollar lower as risk sentiment improves
- Euro strength continues
- Sterling holding firm for now, eyes key events
- The pound has recovered slightly versus the stronger euro and pushed higher versus the dollar as we roll into a new week. While there are many issues, Brexit, risk sentiment, Tory issues, suppressing sterlings performance, the pound is trying to hold firm. Markets will be eyeing todays UK Manufacturing data from May to see how the economy performed as well as tomorrows Brexit negotiations being key indicators of how the currency may perform over the comings weeks.
- The euro was stronger over the course of last week after the European Commission’s proposal as well received by the markets. While there was a lot of optimism around the deal, it still has a way to go and it could be a bumpy road ahead. Against the dollar, it was up over 1.7% last week hitting a high of 1.1091.
The dollar was lower on Friday and also this morning, which was mainly down to month end flows as well as the euro strength move. Markets are also reacting to the re-opening of economies globally which has given investors increased appetite for riskier currencies and assets. Investors will be paying close attention to the US-China relations over the coming weeks and any possible restrictions on trade i.e tariffs or sanctions. Furthermore, looking down the line, the US Presidential race could be perceived as tighter than expected after the unrest and protests turning violent in many states.
Other currency news
The Australian dollar was much higher, hitting a three month high verist he dollar as no new tariffs were imposed on China. The AUD and NZD have rebounded significantly since March lows after both countries bought the coronavirus under control.