Review of the dollar, euro, pound, yen, aussie and gold prices for March 31, 2021


EUR / USD

The European currency is declining against the US dollar during today’s morning trading session, updating record lows since early November 2020 and testing the 1.1700 mark for a downside break. The euro is again noticeably losing to the US currency against the backdrop of renewed growth in US Treasury yields, which reflect investor optimism about the recovery of the US economy. Moreover, today the markets are awaiting a speech by US President Joe Biden, who is to lay out the details of a previously announced plan to change infrastructure spending, which will cost the US economy from $ 3 to 4 trillion. On Wednesday, investors will also focus on macroeconomic statistics from Europe and the United States. The Eurozone will report on the March dynamics of consumer prices, and Germany – on the February unemployment rate. In turn, the US is to publish the ADP report on private sector employment, which will precede Friday’s labor market data for March.

GBP / USD

The British pound is declining against the US currency in trading in today’s Asian session, developing the bearish momentum that formed at the beginning of this week. Investors are again actively buying the dollar amid growing yields on US bonds and are responding positively to the pace of vaccination, which allows them to hope that most of the quarantine restrictions will be lifted soon. However, given the next crisis in the incidence rate in Europe, not all analysts are so optimistic. There is an opinion that a too fast economic recovery and the abandonment of most of the restrictive measures could lead the United States to a third wave of coronavirus, which, judging by European indicators, will not be weaker than the first two. The same can be said to some extent in the UK, where the rate of vaccination of the population is one of the highest to date. The focus of attention of British investors today is the updated statistics on the dynamics of UK GDP for the 4th quarter of 2020, as well as the March data on the dynamics of house prices from Nationwide.

AUD / USD

The Aussie is posting weak corrective gains against the US currency during today’s Asian trading, supported by strong macroeconomic data from China and positive data from Australia. Thus, the number of building permits issued in Australia in February rose by 21.6% mom against a decrease of 19.4% mom in the previous month. Analysts were counting on the emergence of positive dynamics, but predicted a more modest growth at the level of 5% m / m. In annual terms, the indicator increased from 19% y / y to 20.1% y / y. The Chinese statistics were more encouraging. The index of business activity in the service sector in March rose sharply from 51.4 to 56.3 points, significantly exceeding the forecasts of strengthening to 52.6 points. The level of business activity in the NBS manufacturing sector for the same period rose from 50.6 to 51.9 points, while the forecast of an increase only to 51.2 points.

USD / JPY

The US dollar is showing solid gains against the Japanese yen, developing strong bullish momentum since March 24. The instrument is adding about 0.50% and is located not far from another strong resistance at 111.00, above which the pair rose last year ago. The American currency is strengthening on almost all fronts, responding to the renewed growth in US Treasury yields and awaiting a new plan to change infrastructure spending in the US from President Joe Biden. Macroeconomic statistics from Japan published today turned out to be rather depressing. Thus, the volume of industrial production in February decreased by 2.1% mom after rising by 4.3% mom in the last month. Analysts had expected a decline of 1.2% m / m. On an annualized basis, production rates slightly improved from -5.2% y / y to -2.6% y / y, which can hardly be called strong data.

XAU / USD

Gold prices are declining in today’s morning session, developing a fairly confident “bearish” momentum, which was formed at the beginning of the week. On the eve of the instrument showed the strongest fall in the past few weeks, which was associated with another surge in the yield of US Treasury bonds, which renewed 14-month highs. The pressure on gold is also exerted by the general optimism in the market associated with the growing pace of vaccination in the world. However, the situation with the coronavirus in Europe and South America remains very alarming, which does not allow investors to fully concentrate on the positive agenda.

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