In May the US dollar has regained some of the ground it lost last month when it had its longest stretch without gains against a basket of peers in nine months.
The April drop in the greenback is a sign that markets think the global economic is on the way to a post-pandemic recovery.
Currencies such as AUD, NOK and CAD with strong ties to commodity prices bounced and the euro climbed 3 per cent to trade above $1.20.
AUDUSD at 0.7724 is near its 90-day average, range 0.7582-0.7976. AUD/USD Rate Guide
The Australian Dollar held above US77c after the RBA’s May monetary policy announcement left interest rates unchanged as expected. AUD Markets
OFX remain optimistic the AUD will maintain momentum through the long term, however a short-term break toward 0.76 (1.31) is possible if risk demand doesn’t re-establish a solid footing. In April OFX predicted that if AUD/USD can’t break the 0.80 level again (USD/AUD 1.25) then this could see investor demand for the antipodean currency waiver. AUD-USD Forecasts
The Euro continues to struggle in 2021 against the Aussie dollar with AUD/EUR near 2-YEAR HIGHS (over €0.64) due to the Aussie dollar strength and uncertainties over the Eurozone Covid vaccine roll-out. AUD-EUR Forecasts
GBPUSD at 1.3896 is just above its 90-day average, range 1.3689-1.4147. GBP/USD Rate Guide
The coronavirus pandemic had replaced Brexit in the headlines for most of last year. In 2021 the pound has held or even improved its value while markets sort through the aftermath of Brexit and the improved vaccine response from the UK. GBP Markets
ING predict GBP/USD should breach 1.50 this year. While risks remain in place (the negative headline news around the Scottish independence referendum; the ongoing risk of tariffs should UK government choose to deviate from EU labour laws) GBP-USD Forecasts
CADUSD at 0.8147 has risen 2.3% above its 90-day average, range 0.7835-0.8151. 90D▲HIGH CAD/USD Rate Guide
Canadian Dollar exchange rates have gained amid Canada’s economic outlook and recovering oil prices. Early success in controlling COVID-19 has helped the Canadian economy to rebound as massive government aid boosted consumer spending and low interest rates fueled a surge in the housing market. CAD Markets
The Bank of Canada’s announcement in late April to bring forward the time when it expects to raise interest rates helped the Canadian dollar to rise up above US80 cents (USD below C$1.23). USD-CAD Forecasts
EURUSD at 1.1999 is near its 90-day average, range 1.1718-1.2170. 14D▼LOW EUR/USD Rate Guide
The Euro has weakened against the US dollar in early May after a very good April rising from 1.17 to 1.21 – this was despite Europe still struggling with third Covid waves. Recent higher European vaccination gives markets confidence in a European recovery later in the quarter. EUR Markets
The pound strength has hit a snag in April on concerns relating to AstraZeneca shot – which the U.K. is heavily dependent on – while the euro has strengthened on good immunisation numbers coming out of the eurozone earlier than expected. GBP-EUR Forecasts
USDINR at 73.84 has risen 0.6% above its 90-day average, range 72.29-75.45. USD/INR Rate Guide
The Reserve Bank of India’s announcement of a huge government bond purchase programme in April has ended the Indian rupee’s resilience to U.S. dollar strength and other currencies such as GBP and AUD. INR Markets
The Indian rupee’s good run versus the U.S. dollar ended in April with the RBI’s QE announcement combined with the unfolding Covid tragedy sending USD/INR back below 74 to the greenback. USD-INR Forecasts
NZDUSD at 0.7197 is just above its 90-day average, range 0.6956-0.7443. 1D▲+0.7% NZD/USD Rate Guide
NAB’s forecast for NZD/USD is for the kiwi to rise to 0.76 by the end of the year against the greenback. NZD Markets
National Australia Bank (NAB) have revised upwards their Aussie/Kiwi dollar forecasts now expecting the AUD/NZD rate at NZ$1.09 by June 2021, up from their previous forecast of NZ$1.06. AUD-NZD Forecasts
The U.S. Dollar Index at 91.34 is near its 90-day average, range 90.04-93.28. 14D▲HIGH US-Dollar index
In April the US dollar index had its longest stretch without gains for nine months sinking to 90.6, after investors turned optimistic about global growth and pushed the exchange rate lower against a basket of peer currencies for four consecutive weeks. USD Markets