The US dollar was spotted at its highest point for four months against the euro in the foreign exchange markets after the US economy’s prospects were inflated by traders.
The greenback was spotted up in many pairs following the news on Friday of last week that job growth in the country sped up over the course of the month of January.
This stood in contrast to economic news from other countries around the world.
In Germany, for example, it was revealed that industrial output was down in December by the largest amount since 2009, the year that the credit crunch and recession occurred.
In a further blow for the single European currency, it was also shown on Monday that Italian industrial output in December was down way below what analysts had predicted.
According to analysts, this was a positive double whammy for the dollar – positive news at home, and negative news abroad.
The economic impacts of coronavirus also played a role in the foreign exchange market’s decision to swing behind the dollar.
The greenback has emerged as something of “safe haven” in the wake of the coronavirus, with traders flocking to the currency in droves.
In terms of performance, the dollar was recorded on Monday as being at 109.66 in its pair against the Japanese yen, which is also known for being a safe haven currency.
Several other currencies paled into insignificance in contrast to the dollar’s strong performance.
The euro was down at one point to its worst performance in four months against the greenback.
It was seen at $1.0925 in this pair.
As well as the global situation and the issue of negative economic data, there were also political aspects to the euro’s moves.
It was revealed on Monday, for example, that Annegret Kramp-Karrenbauer – who is the leader of German Chancellor Angela Merkel’s political party and believed to be Merkel’s preferred choice to succeed her – would not stand in the upcoming race for Chancellor.
This unexpected political move contributed in part to the euro’s decline and the consequent fuelling of the US dollar.
Elsewhere, the British pound was down to its worst performance in two months in its pair against the US dollar.
It was spotted at $1.2870 at one stage, although it did later recover and head to $1.2938.
The Australian dollar, which is often interpreted as a proxy for the performance of the Chinese economy due to the deep trading relationship between the two countries, was down.
It was spotted at $0.6656 against the greenback, which was at its lowest position in over a decade.
However, it later managed to secure a recovery to $0.6682.
The dollar was noted at 0.9774 in its pair against the Swiss franc, while the euro was seen at 1.0683 in its pair with the franc.
This latter performance represented a drop of around 0.15%.
In its pair with the Canadian dollar, the US dollar was up marginally and was seen at 1.3316 at one point.