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Dollar Struggles at 3Week Lows as Recovery Optimism Grows

The U.S. dollar was mired at a threeweek low on Tuesday as growing optimism about the outlook of the global economy in the coming months sent investors scurrying to purchase riskier currencies including the euro, crown and the British pound.

Against a basket of its rivals, the greenback steadied at 90.229, its lowest level since Jan. 27. It has fallen nearly 1.5 over the past eight trading sessions.

The positive outlook for the major economies continues to support financial market sentiment thanks to sharp gains in crude oil prices and optimism over better growth ahead due to the impressive rollout of COVID vaccines, MUFG strategists said.

The latest U.S. dollar weakness was more noticeable as it was against a broader backdrop of rising U.S. Treasury yields, a factor that was previously supportive of the greenback.

The buoyant mood also dragged on the safehaven Japanese yen , which fell through its 200day moving average against the dollar and struck multiyear lows against the euro, Aussie and Swiss franc.

Sterling, extended gains to hit 1.3946, its highest level since April 2018 as Britain leads the world in percapita vaccination speed. The currency has gained almost 3 from earlyFebruary lows.

Things right now reflect greater comfort with the story of a synchronised global recovery, which is why we are seeing a weaker dollar, said Bank of Singapore currency analyst Moh Siong Sim.

The euro crept 0.2 higher to 1.2150 to retest recent resistance at that level….

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