MUFG’s Derek Halpenny highlights continued Euro weakness, noting EUR remains the worst performing G10 currency this month despite a narrowing OAT/Bund spread and more supportive swap differentials. The analysis links renewed EUR/USD downside to rising natural gas prices and growing investor scepticism over the European economy’s ability to withstand the ongoing energy price shock.
The Indian Rupee (INR) weakens again versus the US Dollar (USD) as demand for US Dollars remains significant due to elevated oil prices. In the opening trade on Tuesday, the USD/INR pair is slightly up to near 95.22.
Gold price (XAU/USD) rebounds to around $4,010, snapping the two-day losing streak during the early Asian session on Tuesday. The precious metal edges higher as easing oil prices temper inflation concerns ahead of this week’s US Federal Reserve (Fed) meeting.