A better outlook for the European and British economies has caused the US dollar to deepen its multi-year lows against the pound or euro. It also weakened compared to the Australian dollar, against which it is the weakest in three years.
The weakening of the US dollar against the British pound, euro or Australian dollar came on the basis of investors’ growing belief that the United States would go much further in its economic policy than is necessary for the US economy. Thus, investors do not believe that monetary policy could be enforced in the near future, which would begin to hold back relatively high inflation or more moderate fiscal policy.
The euro firmed 0.4 percent against the dollar to $1.2162 a euro. According to analysts, the currency pair’s further development will depend on whether the US economy can rebound significantly after the pandemic has receded significantly.
Compared to the pound, the US dollar lost half a percent, and one pound traded at more than $1.4 on Monday. This is the weakest since April 2018. The Australian dollar also took a ride on the optimistic wave against the US dollar. It’s reached its highest level in three years.