A holiday in Europe found the U.S. dollar flat on Monday morning in North America, with trading volumes thin.
Further, major oil producers agreed to the output cuts on Sunday to prop up oil markets as the pandemic severely curtailed global demand. OPEC and allies led by Russia said they had an unprecedented deal with fellow oil nations, including the United States, to curb global oil supply by 20%.
Measures to slow the spread of the coronavirus, such as lockdowns, have destroyed demand for fuel and driven down oil prices.
The greenback has been pressured in the last few weeks by Federal Reserve measures that have flooded the financial system with dollars. This bold movement aims to address a liquidity crunch caused in part by demand for the U.S. currency.
China will be releasing export data for March on Tuesday, and is set to show shipments continued to contract. Analysts will be closely watching for details on overall trade to gauge the pandemic’s damage on the global economy.
Trading could be somewhat subdued as financial markets in Australia, New Zealand, Hong Kong, and Britain are closed for the Easter Monday holiday.
START TRADINGForex – Dollar flat amid holiday-light trading
Financial markets remain on edge over the spread of the novel coronavirus. Severe restrictions on personal movement drag the global economy into a deep recession. A slower flow of news in the past few days has boosted risk assets modestly, and the dollar has drifted modestly lower.
The dollar index, which measures the greenback against a basket of six rival currencies, was up 0.04%.
The Canadian dollar was slightly weaker against its U.S. counterpart on Monday. Oil prices were largely unmoved by a landmark deal by OPEC and its allies to cut output. The loonie was at C$1.3968 to the greenback, or 71.56 U.S. cents, weaker than Friday’s close of C$1.3953, or 71.7 U.S. cents.
Against the safe-haven Swiss franc, the greenback held steady at 0.9644.
The greenback had earlier drifted higher against the Australian and New Zealand dollars. As the weekend’s OPEC+ deal failed to soothe demand concerns, those trends had mostly reversed in mid-morning trade.
The yen rose 0.62% to 107.83 per dollar on Monday and jumped more than 0.5% against the Australian and New Zealand currencies.
Against the euro, the dollar was 0.35% stronger at $1.090.
The pound rose 0.3% to $1.2509 and last fetched 87.57 pence per euro.
Oil prices were mixed as the historic Sunday deal was not enough to ease worries about the demand destruction.
Brent rose 26 cents, or 0.8%, to settle at $31.74 a barrel. In addition, WTI crude slipped 35 cents, or 1.5%, to settle at $22.41, its lowest since April 1. Earlier in the day WTI was up over 5%.
PLEASE NOTE The information above is not investment advice.
Sources: Reuters, Investing, CNN money