Review of the dollar, euro, pound, yen, aussie and gold prices for April 5, 2021


The European currency is showing moderate gains against the US dollar during today’s Asian session, recovering from a slight correction last Friday, when the instrument retreated from its local highs since March 29. Trading activity remains low today as European markets are closed until Tuesday for Easter. The Friday report on the US labor market for March was also left without due attention, but a reaction to it should be expected already with the opening of today’s American session. Recall that the report reflected a sharp increase in the number of new jobs created outside the agricultural sector in March, by 916 thousand, after rising by 468 thousand in the previous month. Market forecasts assumed an increase of only 647 thousand. At the same time, the average hourly wages in March unexpectedly decreased by 0.1% mom after increasing by 0.3% mom over the previous period. Analysts had expected the positive dynamics to remain at the level of + 0.2% m / m.


The British pound is trading with multidirectional dynamics in tandem with the US currency, holding close to local highs since March 23. Investor activity in the market remains rather low, due to the celebration of Catholic Easter, and therefore the former drivers remain in the center of traders’ attention. The pound is supported by very optimistic investor sentiment regarding the prospects for the recovery of the British economy. Soon, the market expects a new wave of easing quarantine restrictions in the UK, which will allow the opening of most of the stores and will contribute to the growth of trading activity.


The Australian dollar is marginally higher against the greenback, trading just above 0.7600. Market activity is gradually recovering as investors return from the Easter holidays, but there are still few new growth drivers. Inflation data from TD Securities provided some support to the Australian dollar on Monday. At the end of March, the inflation rate accelerated from the previous + 0.1% m / m to + 0.4% m / m, which turned out to be better than analysts’ average expectations. Bullish activity on the instrument is constrained by a strong report on the US labor market, published last Friday. Recall that the report showed a record growth in the number of new jobs by more than 900 thousand, which reflects the high pace of recovery of the American economy after a protracted period of quarantine restrictions. The Reserve Bank of Australia is to publish its interest rate decision tomorrow and hold a press conference. As before, the Australian regulator is not expected to change the vector of monetary policy, but the comments of its representatives will be very important.


The US dollar is flat against the Japanese yen, holding close to record highs and a new psychological resistance at 111.00. Trading activity in the market remains rather low, as European sites are still closed due to the Easter holidays. In turn, the yen is supported by good macroeconomic statistics from Japan. Thus, the manufacturing PMI from Jibun Bank in March rose from 46.3 to 48.3 points, which turned out to be better than most forecasts. At the same time, the index still remains below the psychological mark of 50 points, which separates the growth of business activity from its stagnation. The focus of attention of American investors on Monday will be a block of statistics from ISM on business activity in the US for March. Analysts expect significant growth in all major indicators, which is likely to provide tangible support to the dollar.


Gold prices are consolidating after a strong rally at the end of the last trading week, when the instrument was supported by a decline in US Treasury yields. Gold was also strengthened by Joe Biden’s unveiled plan to modernize US infrastructure last week, which will cost US taxpayers more than $ 2 trillion. Investors fear that such a large injection of funds into the US economy will contribute to a sharp increase in inflation in the near future, and therefore prefer to diversify their risks.

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