Forex Signals – The U.S. dollar was down on Wednesday morning in Asia after increasing optimism over a global economic recovery from COVID-19 increased investor risk appetite.
There are almost 6.4 million global cases of the virus as of June 3, according to Johns Hopkins University.
The dollar has sold off in early European trade Wednesday, with riskier assets in demand as investors look for more fiscal stimulus amid signs of a global economic recovery.
Pound Sterling Australian Dollar (GBP/AUD) Exchange Rate Muted on Aussie Recession Woes
The Pound Sterling Australian Dollar (GBP/AUD) exchange rate remained largely flat this morning. This left the pairing trading at around AU$1.8177.
Sterling (GBP) Flat as UK PMI Reveals ‘Deeply Concerning Picture’
The Pound remained flat against the Australian Dollar on Wednesday morning after PMI data revealed the severe downturn in the country’s services sector continued in May.
Traders note that political risk surrounding President Jair Bolsonaro persists, the COVID-19 crisis is far from over and fallout from the looming recession has yet to be felt.
Analysts at Deutsche Bank (DE:DBKGn) reckon record low interest rates, no economic growth and “rising political noise” will see the dollar rise above 6.00 reais in the coming weeks.
“There are significant headwinds to demand in prospect–higher unemployment, falling wages and significant economic uncertainty,” HSBC said.