August 20, 2021

Major Currencies Continue to Be Severely ‘Slaughtered’ US Dollar

 The greenback extended higher gains ahead of weekend trading in the Asian session, with most other major currencies continuing to be weighed down by concerns over a growing coronavirus outbreak.

Optimism for a reduction in bond purchases to be implemented this year by the Federal Reserve has further strengthened the strengthening of the US dollar which has also benefited as a safe-haven amid risky sentiment.

The US jobless claims volume reading published yesterday, also supported the US dollar after showing a decline to its lowest level since mid -March 2020, last week.

The dollar index, which measures the strength of the greenback against a basket of major currencies, jumped to a 9 -month high, leading it to trade strong at 93.50 at the start of the Asian session.

Following market concerns over the Covid-19 contagion and falling oil prices, commodity-linked currencies fell sharply over the weekend, with the Canadian dollar being dragged down to its latest six-month low.

Meanwhile, the euro continued to trade weak around a 9 -and -a -half -month low, after posting a decline of around 0.94% this week, the most fall since mid -June.

The pound sterling, meanwhile, touched a one -month low, as rising coronavirus cases in the UK added to market concerns over the currency. It has fallen 1.64% this week, which is the biggest decline in two months.