The dollar fell lower in Asia on Monday morning, extending losses from the previous week and heading for its first monthly drop in five months. As fears of a worldwide recession have faded, investors have decreased their expectations that increasing US rates will fuel additional increases.
By 1:32 a.m. ET, the US Dollar Index, which measures the value of the dollar fall against a basket of other currencies, had a decline of 0.23% to 101.27. (5:32 AM GMT).
The USD/JPY exchange rate fell 0.09% to 127.
The Australian dollar rose 0.28% to 0.7180, while the New Zealand dollar rose 0.26 percent to 0.6551.
The USD/CNY exchange rate dropped 0.75% to 6.6483, while the GBP/USD exchange rate rose 0.19 percent to 1.2640.
The dollar fall and data showing this week could potentially provide clues about the global economy’s prospects. On Tuesday, China’s manufacturing and non-manufacturing purchasing managers indexes and Eurozone’s consumer price index, will be released. On Friday, the US will release its May employment data, which will include non-farm payrolls.
The US stock and bond markets are closed for the Memorial Day vacation, markets are expected to be quiet on Monday. The dollar was a smidgeon weaker versus the euro in the Asian session, trading at $1.0728, just above a five-week low, after sliding 1.5% against the single currency the previous week.
The dollar index, which earlier this month reached a two-decade high of 105.010. It held steady on Monday, while the pound maintained its gains from the previous week.
In offshore trade, the Chinese Yuan maintained a firm, supported by the possible ease COVID-19 regulations in some cities. Shanghai announced on Sunday that they will lift “irrational” commercial restrictions on June 1, 2022. Correspondingly, Beijing reopened parts of its public transportation and certain malls.
Other investors are hesitant to predict the end of the dollar fall soon. Meanwhile, solid U.S. consumer statistics and the loosening of Chinese lockdowns are boosting global growth optimism.
Investors are already wagering that after raising interest rates quickly for the next two months, the US Federal Reserve will take a break.
Meanwhile, cryptocurrencies have continued to fall. Bitcoin unable to recoup losses suffered during a widespread sell-off of risk assets at the beginning of the month.
Read more: Economy