US Dollar Rises Amid Concerns of COVID-19 Resurgence Worldwide
The US dollar's safe haven appeal received a boost at the start of a brand new trading week amid rising concerns about the spread of the
The US dollar’s safe haven appeal received a boost at the start of a brand new trading week amid rising concerns about the spread of the delta variant of the coronavirus hurting global economic recovery. At the time of writing, the US dollar index DXY is trading around 92.71.
The market sentiment has turned risk-averse sending commodity currencies and other leading currencies to multi-month lows against the greenback. While AUD/USD has slipped below the key $0.75 level, NZD/USD has broken past the key $0.70 level as uncertainties driven by the pandemic return to haunt markets once again.
After several weeks of optimism that economies around the world are rebounding from the crisis on the back of strong COVID-19 vaccine rollout programs, the spread of the highly contagious delta variants has forced many countries to bring back lockdowns and restrictions. After affecting several Asian countries, it has also made its way to the West, especially in the UK which is planning to reopen fully soon.
Even the US, which has implemented one of the fastest vaccine distribution initiatives, fresh COVID-19 infections are on the rise, heightening worries that the strong economic rebound could be hit. The peak summer months were expected to boost several sectors of the US economy, especially domestic consumption and travel, but an increasing caseload is clouding the outlook once again.
Meanwhile, on the economic data front, the present week has little to offer, so the focus is likely to be on the pandemic-related developments worldwide. Later in the week, we get a look at PMI readings, which could shed more light on the pace of economic recovery across leading economies.
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