RationalFX : Sterling rose to two week highs against both the Dollar and Euro on Tuesday, boosted mainly by improving global risk appetite which saw the greenback fall …
The prospect of economies reopening around the world caused investors to become more optimistic which caused sterling to strengthen.
Boris Johnson announced the next steps on how restrictions will be eased with non-essential retail shops to be opened by 15th June if government tests are met. Sterling still remains under pressure due to the UK’s high death rates from Covid-19 and Brexit related risk, but easing of restrictions is likely to be pound positive.
The dollar fell across the board on Tuesday as optimism about a potential coronavirus vaccine and economies reopening worldwide led to investors to shrug off US-China tensions, reducing the demand for safe haven assets.
US-China tensions have been simmering in the background as the US repeatedly criticized Beijing’s handling of the coronavirus outbreak. However investors have largely dismissed them due to optimism building of the prospect of economies restarting.
This was also supported by positive consumer confidence data for May showing the worst of the pandemic has passed and consumers are now preparing for the US economy to reopen soon.
08:30 – EUR – ECB President Lagarde Speaks
Source : ETFWorld.co.uk