After being under strong pressure for several weeks, the US dollar strengthened against the euro last week, with its value against the most important world currencies moving away from the lowest level in 15 months.
The dollar index, which shows the value of the US dollar against six major world currencies, rose last week by about 0.9 percent, to 75.606 points. A week earlier, it was at the lowest levels in the last 15 months – below 75 points. Last week, the US currency strengthened against the European one by 0.3 percent, bringing the euro exchange rate down to 1.4860 dollars.
However, the dollar weakened against the Japanese currency by 0.75 percent, bringing its price down to 88.95 yen. The European currency also weakened against the Japanese one. The price of the euro fell by 1.20 percent, to 132.10 yen. The strengthening of the dollar is primarily due to investor uncertainty regarding the further direction of stock prices on global exchanges, following weak data from the US economy. As a result, they are less inclined towards riskier assets, seeking refuge in safer investments, such as the US and Japanese currencies, as well as gold. Thanks to this, the price of gold reached its highest level in history – 1,153 dollars per ounce – by mid-week. With investors withdrawing from riskier assets, higher-yielding currencies, such as the euro and Australian dollar, have lost their appeal.
