Review of the dollar, euro, pound, yen, aussie and gold prices for March 4, 2021


The European currency has been declining against the US dollar during today’s Asian session, developing a weak bearish momentum that had formed the day before. Let us remind you that last Tuesday the single currency was traded with an upward trend, provoked by a large-scale correction in the bond market. The macroeconomic statistics from Europe published yesterday turned out to be ambiguous and only slightly affected the dynamics of the instrument’s movement. Thus, the index of business activity in the German services sector from Markit in February fell from 45.9 to 45.7 points, which turned out to be worse than the neutral forecasts of analysts. The composite index for the same period corrected from 51.3 to 51.1 points. Meanwhile, in the eurozone, business activity continues to gain momentum as the epidemiological situation in the world improves. In the services sector, the Markit activity index rose from 44.7 to 45.7 points, and the composite indicator strengthened from 48.1 to 48.8 points, beating the neutral forecasts.


The British pound is trading mixed during today’s Asian session, consolidating around 1.3950. Investors expect new drivers to appear, which may be the US labor market data for February, which will be published on Friday. However, the markets have not experienced a lack of macroeconomic statistics throughout this week. Thus, the index of business activity in the UK services sector from Markit in February fell from 49.7 to 49.5 points, and did not reach the level of 50 points. US business activity statistics were mixed. The index in the services sector from Markit rose from 58.9 to 59.8 points, while the similar index from ISM, on the contrary, fell sharply from 58.7 to 55.3 points. The ADP report on employment in the private sector, which reflected an increase in jobs of only 117 thousand in February, after an increase of 195 thousand in the previous period, also remained without due attention at the moment. The focus of traders on Thursday will be the speech of the head of the US Federal Reserve Jerome Powell, as well as the updated statistics on the dynamics of applications for unemployment benefits in the US.


The Australian dollar is slightly strengthening against the US currency, leveling the results of yesterday’s “bearish” session, when the instrument retreated from its local maximums. It is curious that the American currency managed to demonstrate growth, despite the publication of extremely controversial macroeconomic statistics from the United States on business activity and employment in the private sector. It should be noted that the data on business activity in Australia turned out to be no better, however, the main support for the instrument was provided by the statistics on the dynamics of the Australian GDP. Thus, according to the results of the 4th quarter of 2020, the Australian economy added 3.1% q / q, only slightly slowing down after the previous increase by 3.4% q / q. Analysts had expected GDP growth by 2.5% q / q. On an annualized basis, the pace of economic decline slowed from –3.7% yoy to –1.1% yoy, outstripping the forecasts at –1.8% yoy. Investors are now focusing on the statistics on the dynamics of exports from Australia (+ 6% m / m after increasing by 3% m / m in the previous month), which provoked a significant increase in the trade surplus in January.


The US dollar is strengthening against the Japanese yen during today’s morning trading session, trying to gain a foothold above the strong resistance at 107.00. The American currency continues to be in high demand, however, the published macroeconomic statistics in the US somewhat restrains the “bullish” activity on the instrument. Investors reacted negatively to the release of ADP data on private sector employment in February and are eagerly awaiting the release of the final report on the US labor market at the end of the week. The yen is slightly supported today by data from Japan. Thus, the consumer confidence index in February rose from 29.6 to 33.8 points, while analysts’ forecasts suggested an increase only to 30.6 points.


Gold prices are showing corrective gains during today’s morning trading session, retreating from the next record lows, updated the day before. The reason for the next wave of instrument sales on Wednesday was the high yield on US Treasury bonds, as well as rather strong positions in the American currency, which largely ignored the appearance of weak macroeconomic statistics in the US. American investors have also responded to the improvement in the country’s epidemiological situation. In particular, the state of Texas is preparing to lift the requirement to wear a mask and lift a number of restrictions on the work of small and medium-sized businesses. President Joe Biden also echoed the optimism in the market, saying that adults in the United States will be able to get vaccinated by the end of May.

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