July 19, 2021

Bloody Start of Major Currencies In European Session

 The greenback dollar surged higher at the start of the European session, dragging most major currencies to plunge lower amid risky sentiment.

At the opening of the European session, the dollar index soared, surpassing its latest high since early April by rising around the price of 92.90.

Positive US retail sales data readings continued to provide support for greenback trading to continue to strengthen, where it returned to show growth in June after recording a big contraction in the previous month.

This is seen as contributing to one of the reasons for the Fed to start reducing its bond purchases, although last week Chairman Jerome Powell said it was still too early to make a policy change.

Meanwhile, market anxiety over a worldwide coronavirus resurgence continued to weigh on major currency trading as investors turned to the safe-haven currencies of the US dollar and yen for protection.

In the UK, the daily case figure of almost 50,000 per day is causing the excitement of pound currency investors to be free of coronavirus restrictions today is fading.

This can be seen at the beginning of the session, where European stock markets opened weak and the pound sterling plunged to its latest three -month low against the USD.

Commodity currencies continued to receive a blow from the strengthening USD, pushing the Canadian dollar to a three -month low and the Aussie dollar to a nearly seven -month low.

The euro also slipped lower following the surge in the greenback dollar, with market focus now focused on the European Central Bank (ECB) meeting to be held on Thursday.