The single currency made strong gains yesterday as the dollar came under pressure about its future status as the chief currency used in oil trades.
- The single currency broached two week highs as a report came through that Arab States were in secret discussion to find alternatives to using the dollar in oil trades.
- Major oil-producing countries have denied the report, but markets reacted strongly to the news, which has added fuel to arguments that the US currency’s global status is coming under pressure.
- Analysts noted that the dollar’s sharp fall was a good example of poor sentiment toward the US currency being vulnerable to speculative selling.
- Rallying equity markets encouraged further dollar selling, with risk appetite in the market diminishing the appeal of the haven currency.
- Risk was also high following the Reserve Bank of Australia’s relatively unexpected rate hike, which spurred demand for high-yielding assets, lending support to an upward movement in the euro/dollar price.
Related posts:
- The euro has made strong gains against the dollar, buoyed by a rise in risk and pressure on the US currency
- Selling pressure held firm on the pound yesterday, with the euro price falling below €1.08
- The euro slid sharply against the dollar yesterday, weighed down by a rise in risk aversion
- The euro made ground against the dollar on Friday, but has relinquished its gains this morning
- Aussie hits new highs on sterling weakness and a rise in demand for higher-yielding currencies
Posted in 
