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June 29, 2021

Major Currencies Plunge Driven By Strong USD

 The greenback continued to maintain its strengthening momentum by rising higher than its main rivals in the European session.

Concerns over the increase in Covid-19 cases due to the rapidly spreading Delta variant in Asian and European countries, have given support for the safe-haven greenback and the yen to rise.

At the beginning of the European session, the dollar index that measures the strength of the greenback dollar against a group of major currencies traded up at 92.00.

The euro traded lower around 1.1900 ahead of European Central Bank (ECB) President Christine Lagarde’s speech tonight. However, the market expects that Lagarde will continue to make dovish statements on current monetary policy.

The alarming surge in cases has prompted several European countries, including Germany, Portugal and Spain to impose travel restrictions on unvaccinated Britons.

Meanwhile, the pound continued to trade weak, weighed down by fears an increase in Covid-19 cases would prevent the UK from coming out of the coronavirus ban despite Health Minister Sajid Javid confident that England would lift the ban on July 19 as planned.

Meanwhile, the Canadian dollar traded 0.2% lower against the USD, amid declining crude oil prices weighed down by concerns over the rising Covid-19 case, ahead of the OPEC+ meeting on Thursday.

On the other hand, the Aussie and New Zealand dollars also plunged lower following the strengthening US dollar and concerns over the resurgence of Covid-19 in Australia thus forcing Perth to impose sanctions measures to curb the spread.