This morning, the value of the US national currency began to grow against the main currencies of the world, in particular the Japanese yen. The reasons for the resumption of positive dynamics of the dollar should be found in the possibility of a repeat of the situation with the COVID-19 pandemic in the world against the background of incoming news about the growth of infected people in the United States and China.
The morning value of the single European currency was at 1.1236 dollars per euro. Recall that the previous auction ended at the level of 1.1256 dollars per euro, which indicates a slight strengthening of the dollar. The euro is also getting cheaper against the yen. Today's exchange rate was 120.50 yen per euro, while Friday's value was around 120.89 yen per euro.
As for the US dollar, its relationship with the yen has also changed in the direction of reducing the latter. So, today the Japanese national currency was trading at 107.24 yen per dollar, and on Friday its rate stopped at 107.38 dollars per yen, which indicates a decrease of 0.13%.
The dollar index against a basket of six major currencies of the world (ICE Dollar) at the beginning of the new week slightly (by 0.03%) sank compared to the previous indicator. At the same time, the dollar index against the world's sixteen major currencies (WSJ Dollar), on the contrary, showed a solid increase of 0.34%.
Market participants are seriously concerned that the second wave of the coronavirus pandemic may be quite real since the number of infected people is growing in the United States of America, as well as in China. According to most analysts, the new round of COVID-19 will be even more stressful for the world economy and will cause much more significant consequences, which will require huge efforts and a lot of time to deal with, and no one will be able to calculate the overall damage.
Meanwhile, the US currency began to strengthen. Against the yuan, the dollar is increasing by 0.19%: its current value is 7.0967 yuan per dollar.
The Australian dollar is also reducing its position against its American counterpart: the fall was approximately 1.19%. "Aussie" is trading around 0.6784 dollars. The Australian dollar has traditionally shown extreme sensitivity to any changes in the global economy. Thus, even minor negative forecasts can cause the currency to change its course in the direction of humiliation. To date, the factors for the fall are the adjustment of the main forecasts for economic growth, which takes place in a minor key. Thus, the rate of the "Aussie" can sink even more and get to the level of 0.6665 dollars for the "Aussie". In addition, the Australian national currency is waiting for statistics from the labor market, which may also affect its rate.
The national currency of the UK is also declining against the US dollar. This morning, its rate was fixed at 1.2458 dollars per pound, while in the previous session it was trading at 1.2540 dollars per pound.
Recall that over the past few weeks, the US dollar has recorded negative dynamics. Its exchange rate was declining, which gave investors room for extremely disappointing forecasts. Most analysts pointed to the fact that the US public debt is growing, followed by a payment deficit. This could not pass by the currency and certainly, put pressure on its value. However, the "lifeline" for the "American" was fears about the second wave of the pandemic. Market participants hurried to save themselves and began to actively use the dollar. In addition, the US government announced its readiness to introduce a new batch of stimulus measures that can support the state's economy. This was also good news for investors, who hurried back to the dollar. Thus, in the near future, the exchange rate of the national currency of America is unlikely to return to negative and will continue to strengthen, and you will have to tune in for the long term.
