The US dollar continued to maintain higher strength as concerns over the second wave of coronavirus in Europe prompted the sale of all major currencies.
The dollar index, which measures the strength of the greenback dollar against a basket of major currencies, soared to a 6-week high at the start of the Asian session trading at 93,547.
The major currencies showed a sharp decline at the start of the European session on Monday followed by a fall in the stock market mainly driven by sales from financial stocks following the embarrassing scandal involving HSBC and also affected by concerns over more Covid-19 sanctions to be implemented in Europe.
The rise in the US dollar caused the fall in commodity currencies with the kiwi dollar ahead of the decline following investor concerns ahead of the Reserve Bank of New Zealand (RBNZ) policy meeting tomorrow morning on the issue of negative interest rate implementation.
While the Aussie dollar also recorded a lower downturn where it was also affected by the worsening relations with Beijing as more and more Australian investors are now seen to be defecting from Chinese companies.
Meanwhile, the pound continued to extend lower after government chief medical officer Chris Witty said if the current upward trend continued, the UK would probably see nearly 50,000 new cases every day in mid-October.
As a result, Prime Minister Boris Johnson is reportedly considering a nationwide lockdown for two weeks to curb the spread.
Concerns over the significant increase in new cases of Covid-19 especially in Spain and France also prompted the euro to fall to its lowest level, as some restrictions were re-imposed in some areas.
The Japanese yen has performed better this month as turmoil in the stock market has boosted demand for shelter. However, due to the rise of the US dollar, the currency depreciated from a six-month high.
