The value of the U.S. dollar (USD) hit a three-year low against the Australian dollar (AUD) and the British pound (GBP). This is attributed to the fact that investors’ funds are flocking to risky assets. Due to the easing of the increase in the number of COVID-19 cases.
According to Reuters on the 22nd (local time), the USD/AUD exchange rate rose 0.23% to $0.7892. It is the highest since March 2018.
The U.S. dollar/New Zealand dollar (USD/NZD) also rose 0.18 percent to 0.7315 dollars, the highest since April 2018.
The euro/dollar (EUR/USD) rose 0.02% to $1.2124 and the pound/dollar rose 0.04% to $1.4030, reaching a three-year high.
The worst-case scenario of the pandemic passes and more investors focus on economic recovery. And therefore the value of the U.S. currency, considered a safe asset during uncertainty, is likely to fall further in the future.
“The commodity currency and the pound are particularly strong against the U.S. dollar,” said Yukio Izuki, a foreign exchange strategist at Daiwa Securities.
“The British vaccine program is making a lot of progress,” he said. “Economic activity is gradually returning to normal in many places, putting some pressure on the U.S. dollar.”
On the other hand, the yen rose 0.22 percent to 105.73 yen, strengthening the U.S. dollar.
According to Reuters and the Commodity Futures Trading Commission, net selling of the U.S. dollar hit $29.09 billion last week. It is the lowest level since mid-December.
Net selling of the U.S. dollar fell for the fourth consecutive week. This shows that some investors are still optimistic about the value of the U.S. dollar.
Bitcoin fell slightly to $57,090 in the cryptocurrency market. But it is still close to an all-time high as digital assets are more acceptable as mainstream in the financial sector.
