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The dollar has been unchanged against the peer-to-peer basket for nine months in the longest period, with investors optimistic in April about global growth forecasts in April and four weeks in a row after pushing a lower exchange rate.
The fall had a strong March yield as strong US economic recovery raised hopes that inflation could rise as the Federal Reserve pushed for austerity policy, raising bond yields and pulling the dollar against most other major currencies.
But as a sign that investors may not be left behind by the global economic recovery, the dollar index fell 2.7% in value to trade at $ 90.98 a month, while currencies that are strongly linked to commodity prices rebounded. The euro rose 3 percent to trade at $ 1.20 and the Brazilian real was the best currency of the month.
Despite being a eurozone plunging into a recession in the first quarter, analysts expect the blockchain to gradually increase activity as the vaccine program picks up pace and the economy reopens.
The main reason we saw the loss of the dollar index in April is the return of “US” reflection over “global” trading, ”Goldman Sachs strategist Kamakshya Trivedi said.
“In the coming months, we should start to see the inadequacy of European Covid cuts, and we expect stronger gains in oil and copper prices – which should keep the dollar,” he added.
On Wednesday, US Central Bank President Jay Powell search to dispel the pressurized fears of the asset purchase program, stressing that the stance of the policy line was to stay here.
“The Fed has outdone itself. We doubt that this is sustainable, but we have to give it up for now, ”Bank of America analysts said in a statement.
Data from the first quarter show that the gap between the US and European growth rates remains large, with the eurozone shrinking by 0.6 percent in the US the clock 1.6% of the gross domestic product spread.
Silvia Dall’Angelo, a senior economist at Federated Hermes, said the U.S. economy is likely to perform better in the next two quarters, but the eurozone “should start to decline in the third quarter,” and that the dollar is less attractive after the event.
Some analysts are not convinced, however. Win Thin, head of Brown Brothers Harriman’s monetary strategy, said the eurozone is unlikely to align with the expansion of the U.S. economy this year, which would lead to the Fed reducing its asset purchases.
“One of the factors mentioned for the strength of the last euro is the increase in expectations that economic disparities will be reduced in Q2 and beyond. However, we just don’t see it,” he said. “The ECB will need to maintain a fast pace of asset purchases for much longer than expected.”
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