The gloom in the market continued until the European session, with safe-haven currencies continuing to garner demand from investors even after seeing encouraging Chinese economic data.
The world's second-largest economy returned to pre-pandemic levels after China's Gross Domestic Product (GDP) reported growth of 6.5% in the fourth quarter, and overall, the economy grew 2.3% in 2020.
The euro traded flat on the back of a strengthening US dollar supported by rising demand for safe-haven following concerns that economic recovery in Europe would be affected after Pfizer announced a postponement of the Covid-19 vaccine distribution in the region.
The European Central Bank (ECB) policy meeting on Thursday, will be the focus of investors this week, as well as the focus is also on the publication of manufacturing and services PMI data on Friday.
Meanwhile, the Japanese yen also benefited from volatile market sentiment by showing strengthening against most major currencies, particularly the risk-sensitive currencies, the Aussie dollar and the kiwi.
The release of positive Chinese economic data failed to stimulate the rise of the Aussie and New Zealand dollars, in fact, the two currencies fell lower with trading at the 1-week and 3-week lows, respectively.
The Canadian dollar also traded weak due to the strengthening US dollar, as well as being affected by declining world crude oil prices.
