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


The European currency is showing moderate gains against the US dollar, developing a “bullish” signal formed the day before, when the euro managed to reverse the emerging downward trend. Recall that the American currency received support at the end of last week thanks to the upbeat macroeconomic statistics on the dynamics of personal income and spending in the United States for March, which once again confirmed the high rates of recovery of the national economy. However, so far this only strengthens the focus of attention on the US Federal Reserve, which is expected to take more decisive actions aimed at curbing inflationary pressures. The euro was supported on Monday by strong macroeconomic statistics from Germany. Thus, the volume of retail sales in the country in March increased by 11% y / y after falling by 6.6% y / y in February. Analysts had expected the negative dynamics to remain at the level of -3.1% y / y. On a monthly basis, sales growth accelerated from + 2.7% mom to + 7.7% mom, also beating market forecasts of + 3.0% mom.


The British pound maintains multidirectional trading dynamics against the US currency, staying at around 1.3900 and offsetting the bearish end of last week, when investors were actively buying the US dollar amid optimistic macroeconomic data. In turn, market participants are still expecting a reaction to this data from the US Federal Reserve. The regulator prefers to maintain the status quo, writing off the rapidly growing inflation on the high rates of recovery of the national economy. Macroeconomic statistics from the US released on Monday somewhat cooled the fervor of dollar bulls. Thus, the index of business activity in the manufacturing sector from ISM in April fell from 64.7 points to 60.7 points, while analysts expected its growth to 65 points. A similar index from Markit also dropped from 60.6 to 60.5 points with a neutral outlook.


The Australian dollar is showing mixed performance against the US currency during today’s Asian session, following up on macroeconomic publications from Australia that were released at the opening of trading. Some support for the instrument is provided by statistics on issued mortgage loans, which in March increased by 3.3% mom after falling by 1.8% mom in February. Yesterday the AUD / USD pair showed a steady growth, which was largely due to the technical factors of the correction of the American currency. The dynamics of the instrument was also influenced by not the most confident macroeconomic statistics from the US on the level of business activity in the manufacturing sector, which seems to be losing its initial impetus to growth. The Australian dollar, in turn, received little support from inflation data and amid continued growth in commodity prices. Thus, the RBA commodity price index jumped 34.7% y / y in April after rising 27.2% y / y in March. Analysts expected an acceleration in the dynamics of the indicator, but expected only + 28.3% y / y.


The US dollar is developing corrective dynamics against the Japanese yen, testing the level of 109.00 for a breakdown. After the active growth of the American currency last week, which was caused by strong macroeconomic statistics and increasing yields on US Treasury bonds, the dollar positions at the beginning of the week are under pressure. In addition to technical factors of long profit fixation, the pressure on the US currency is exerted by uncertain statistics on business activity in the manufacturing sector, as well as some market disappointment with the actions of the US Federal Reserve. Recall that the regulator is still taking a wait and see attitude, only hinting at the possibility of reducing the quantitative easing program before the start of the interest rate hike.


Gold prices are showing an upward trend, quickly retreating from the local lows, updated last week. The instrument, which also contributed to the strengthening of other precious metals, was supported by corrective sentiments in the US currency, as well as by a decrease in the yield of US Treasury bonds. The quotes were further supported by the latest statistics on manufacturing activity in the US, which showed a slowdown in growth in April. The focus of investors this week will be Friday’s statistics on the US labor market, which is likely to help more accurately assess the ongoing processes in the American economy. In addition, traders again hope for some more coherent reaction from the US Federal Reserve.

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