This week, U.S. President Joe Biden announced his $2 trillion-plus job plan, including $621 billion to rebuild infrastructure. Interestingly, a $2 trillion U.S. government spending plan helped to boost the U.S. dollar. It is worth mentioning that, the dollar consolidated its first-quarter gains on April 1, holding ner multi-month highs. However, a new lockdown in France affected the euro.
Importantly, across the ocean in Europe, in early trades, the dollar index stood at 93.286 close to a five-month high of 93.439 reached on the last day of March.
The world’s reserve currency added 3.57% against the basket of six major currencies during the first quarter of 2011. It is the best quarterly result since 2018 with investors betting on a swift and powerful economic recovery.
People should keep in mind that, the gains came as the euro is struggling to deal with problems. As a reminder, the euro is the biggest component in the index. Unfortunately, the euro suffers from concerns regarding the euro zone’s recovery. The third wave of COVID-19 infections is a serious issue.
It is worth mentioning that, President Emmanuel Macron ordered France into its third national lockdown. Moreover, the currency bloc lagged the U.S. in vaccination programs.
Euro, yen, and yuan
Europe is struggling to deal with the coronavirus pandemic and it could take several weeks or more to stabilize the situation. Interestingly, the euro changed hands at $1.1720 after reaching a near five-month low of $1.1704.
However, against the British pound, the euro was up 0.08% after hitting a 13-month low of 0.85025 pound.
The U.S. dollar held firm against the yen. The U.S. currency ended March with its biggest monthly gains since November 2016.
It is worth noting that, the dollar traded at 110.77 yen.
Let’s have a look at the Australian dollar. Importantly, the Australian dollar fell 0.67% to $0.7542, its worts result in several months.
People should keep in mind that, the offshore Chinese yuan dropped 0.3% to 6.582 to the dollar. The factory activity in China expanded at the slowest pace in almost a year. This factor affected the situation.
Interestingly, currency trading is expected to slow towards the Easter holidays in many parts of the world. However, the dollar could gain if the key U.S. economic indicators surprise on the upside.
As stated above, Macron ordered France into its third national lockdown. His decision once more underlines the severity of the problem.