After rising almost 9% in the past month against the US dollar, the euro dropped almost 1% on Monday, its worst trading day since mid-March due to worries that Greece might miss its debt payment next month. The same happened to the British pound, which lost its post-election strength as the market is focusing on the risks of the UK’s EU membership and government spending cuts. Sterling reached a low of $1.56303 in early Asian trading. Coming up on Tuesday are the GBP CPI and German ZEW Economic Sentiment news, due at 08:30 and 09:00 GMT, respectively.
The Reserve Bank of Australia released its Monetary Policy Meeting minutes earlier, noting that even though it considered delaying the interest rate cut earlier this month, it ended up deciding to proceed with it given soft growth forecasts. This decision for immediate action was backed up by revised forecasts that growth strengthening would take longer to pick up and also that jobless rated would stay high for an extended period.
Wall Street climbed up to new highs on Monday with the Dow Jones (USA30) and S&P (USA500) reaching $18,289 and $2,128.13 respectively. The boost was due to rising hopes that the Fed will wait longer before a rate hike and also due to a rise in Apple shares which pushed the indices to the new closing highs. The greenback rallied on Monday after reaching four month lows and is continuing to post further gains early on Tuesday.