Forex

Euro rises, risky currencies recover as traders stop cashing in profits

Reuters LONDON | Updated on June 12, 2020 Published on June 12, 2020

The euro edged up slightly against the US dollar on Friday, not far from the three-month high it rose to earlier in the week, as traders paused from cashing in the latest profits.

During the Asian trading session, the Australian dollar and other risk-sensitive currencies gave up ground, before recovering and trading higher against the safe-haven greenback, following a rise in European stocks.

Investors had earlier decided to unwind their positions after a rapid build-up of bets on risk assets that had taken off on hopes of a further re-opening of the economies of many countries.

“As long as governments around the globe continue to ease their lockdown measures, and as long as economic data continues to point that the deep economic wounds due to the coronavirus are behind us, we would treat the retreat as a corrective phase of the broader recovery,” said Charalambos Pissouros, senior market analyst at JFD Group.

“We still see decent chances for equities and other risk-linked assets to rebound again, and for safe havens to come under renewed selling interest,” said Pissouros.

The euro rose 0.1 per cent to $1.1315, staying close to $1.1422, the three-month high it reached on Wednesday.

The Aussie dollar rose 0.4 per cent to 0.6881, after falling to a 10-day low of 0.6799 in the Asian session.

The Nordic currencies also rose, as did the oil-sensitive Canadian dollar, which was last up 0.3 per cent at 1.3585. The Norwegian crown was the biggest mover, rising by 0.6 per cent to 9.5665 against the US currency.

Elsewhere, the British pound remained unfazed by the fact that Britain's economy shrank by a record 20.4 per cent in April from March as the country spent the month in a tight coronavirus lockdown, official data showed on Friday.

Investors saw the number as what is likely to be the bottom of the crash before a long and slow recovery.

Sterling was last flat at $$1.2606 and down 0.1 per cent versus the euro at 89.79 pence.

 

 

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Published on June 12, 2020
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