July 7, 2021

Strengthening of Major Currencies Stunted Following USD Rise

 The king of the US dollar rebounded as the market entered the European session, causing most major currencies to stop their gains ahead of the release of US services PMI data tonight.

The dollar index, which measures the strength of the greenback dollar against a major group, rose higher to around 91.30, after a gloomy Asian session.

The kiwi dollar eased slightly from a two -week high after being driven by optimistic expectations from analysts that the Reserve Bank of New Zealand (RBNZ) will start raising interest rates this year after seeing encouraging business confidence data readings.

Meanwhile, the Aussie dollar also eased its gains after soaring to a one -week high, following the outcome of the Reserve Bank of Australia (RBA) policy meeting which saw interest rates remain at a low of 0.10%.

The Canadian dollar also weakened after gaining ground following the strengthening of world crude oil prices to a three -year high after the OPEC+ meeting ended without a deal.

Following the development of the European currency, the announcement by UK Prime Minister Boris Johnson to lift all coronavirus restrictions on July 19, has driven the pound’s trade surge.

However, with the resurgence of the US dollar in the European session, caused the currency to depreciate again.

Moreover, the euro failed to maintain its gains and traded lower ahead of the publication of the German economic sentiment data of the ZEW survey today.