The Greenback’s recent weakness is driven by building confidence that the global economy has made it through the worst of Covid-19.

Key Movers

Last night, the Reserve Bank of Australia (RBA) rate decision was as expected, with rates held at the current level of 0.25 percent. The RBA noted that although the worst may be behind us, the real economic impact may not be felt for some time, with the unemployment rate expected to rise further, perhaps keeping the door open for rate cuts further down the road. The AUD/USD pair has been charging higher since the March 19th low and before the RBA release. It has gained about 15 percent since the March 19th low.The Euro increases as higher Italian bond prices continue and while there is positive momentum ahead of Thursday's ECB meeting. The gains also came amid reports that Germany's Angela Merkel may provide a second stimulus package of as much as 100 billion Euros as part of the European Commission's plan to help the EU. The recovery package is substantial in its reach, particularly for the more vulnerable southern European member states. The EUR/USD pair has a critical resistance level at around 1.1239 from December 31st. It trades at 1.1188 at the time of this writing.The GBP/USD pair has risen by 0.53 percent to 1.2558, buoyed by a report that the U.K. may be willing to compromise with the European Union in trade negotiations.