Dollar moves near seven week high after rise from euro sales

TOKYO (Reuters) – The dollar went over nearly seven weeks high on Tuesday, largely benefiting from overnight euro sales after coronavirus locks stifled consumer spending in Europe’s largest economy .

The euro sank hardest in 2-1 / 2 weeks Monday after data showed German sales fell more than expected in December, with the continent still struggling with vaccine spreads .

The dollar even gained as stocks rallied around the globe, slowing a recent move for the U.S. currency to decline as risk appetite improves.

Australian Commonwealth Bank currency analyst Joseph Capurso said the blip in the relationship came down to the euro, and market sentiment would continue to guide the dollar’s ​​near-term direction.

“When people think of selling euros, you usually get a few bucks, because the euro-dollar exchange rate is the most liquid in the world,” he said.

Overall, global markets remain volatile with institutional investors trying to cope with the retail trading frenzy that has boosted GameStop Corp. and other so-called meme stocks in recent sessions despite they did not change their foundations.

The dollar index fell by 0.1% to 90.87 on Tuesday, among other gains for Asian stocks.

The criterion rose 0.4% overnight and was pushed briefly as high as 91.063 for the first time since Dec. 10.

The euro rose 0.2% to $ 1.20835 after falling 0.7% on Monday, the highest since January 15.

The dollar index has largely been keeping an eye on a tight range in recent weeks, after kicking off a three-year low of 89.206 at the beginning of the year.

Investors are trying to assess whether sales are likely to continue at nearly 7% in 2020 – driven by the prospect of overcoming a global pandemic amid massive fiscal spending and an easy ongoing monetary policy.

Hopes for a quick U.S. recovery boomed when Democrats pushed a $ 1.9 trillion budget measure in a move toward overtaking Republicans on President Joe Biden’s massive COVID relief package, even when a group of Republican elders visited the White House to discuss another $ 618 billion plan. .

The dollar pulled back 0.1% to 104.875 yen after crossing 105 overnight for the first time since mid – November.

The most dangerous Aussie dollar rose 0.4% to 76.485 U.S. cents, rebounding from a two-day loss.

The Reserve Bank of Australia will decide on policy on Tuesday, expecting no change.