The dollar recovered a foothold on Monday after its worst three days of losses since early December, the impact of higher U.S. market interest rates turning it positive on the day against both the euro and a basket of currencies.
As the overall markets are in a proverbial holding pattern in anticipation of the impending figures on labor and economic conditions, traders are closely watching the currency environment, as the strength of the USD is impacting global currency pairs, commodity prices and the treasury markets.
The Euro found itself under renewed selling pressure during trading on Monday following reports of former Prime Minister Alain Juppe confirming that he was not ready to run in the French presidential election. Markets simply acknowledged this fresh development as potentially heightening the chances of Marine Le Pen winning the elections which consequently exposed the Euro to further downside losses on Tuesday.
Brexit-fuelled anxieties have exposed Sterling to sharp losses this week with sellers exploiting the rising uncertainty to attack the GBP/USD currency pair to a fresh six-week low at 1.2260 during trading on Thursday. Sentiment is turning increasingly bearish towards the Pound and the terrible combination of soft domestic economic data from the UK coupled with political risk could ensure the currency remains pressured.
World stocks fell on Monday, after two huge European merger and acquisition deals fell through and billionaire U.S. investor Warren Buffett warned that while stocks are cheap, they are currently unpredictable and prone to a sudden, steep correction.