Most major currencies bounced back higher, especially European currencies, as the greenback continued to trade weak in today’s Asian session.
The UK continued to move forward by easing the closure measure, in which the latest travel restrictions have been reduced, effective Monday.
With confidence the UK economy will recover faster, this has prompted pound currency trading to extend higher gains in the Asian session with it trading strong at 1.41700 against the US dollar.
The strengthening of the pound was also driven by weak US dollar trading amid limited movement of 10-year US bond yields around the same level.
The dollar index, which measures the strength of the greenback against a basket of major currencies, traded lower at 90.07.
This has provided an opportunity for the euro to regain strength against the greenback.
This week, more economic data from Europe will be the main focus of the market which will show how far the economic recovery has taken place.
In addition, commodity currencies also strengthened their position by trading higher. The Aussie dollar continued to strengthen after the publication of a positive report of the Reserve Bank of Australia (RBA) meeting minutes.
While the statement of minutes of the meeting reiterated the RBA’s refusal to assess interest rate hikes before 2024, the central bank rejected a change in the yield curve even though it was necessary.
