It has been a risk-on session today with major currencies making significant gains versus the US Dollar and global equities in the green.
The GBP/USD cross, which had fallen below 1.22 on Friday, has surged to 1.235. But once again it’s the Kiwi Dollar which has outperformed, with NZD/USD up nearly 2% since yesterday and trading above 0.62 for the first time since 12th March. The S&P 500 has breached the 3,000 level for the first time since 5th March and is up 2% at time of writing.
This risk-rally does not appear to have a unique cause but frequent reports that multiple companies are making good progress in developing vaccines and anti-viral drugs for covid-19 are arguably playing a role. Moreover, most European countries are slowly but surely moving towards unwinding national lockdowns which have been in place for over two months, fuelling hope that economic activity will continue to slowly recover from an extremely low base
in Apri.
