As an increasing number of economies continue to ease lockdown measures, risk-on seems to have taken over market sentiment. Risk-related currencies, such as the Australian dollar and the euro, continue to make ground during early Tuesday trading, while those that acted as safe havens during the darker days of the pandemic are now retreating.
This scenario is perfectly illustrated by the performance of the euro versus the US dollar; the single currency has gained more than 1% to the greenback so far this week. The American currency, much in demand when investors prioritised safety, is now on the back-foot, signalling the markets’ renewed hopes of a quick economic recovery.
Ricardo Evangelista – Senior Analyst, ActivTrades
The spot price of gold remains steady, just a few dollars below the 7-year high reached last month. Investors’ appetite for bullion remains huge: despite the large recovery seen in stocks from April onwards, the scenario remains highly uncertain, with potential new corrections just around the corner and traders are still buying gold as a hedging asset. Moreover, central banks are extending their expansive monetary policy, lifting investors’ interest for gold to an historic high.
Carlo Alberto De Casa – Chief analyst, ActivTrades