The U.S. dollar climbed to a three-month high in safe-haven buying on Tuesday, and investors are still worried about the rapidly spreading variant virus, which may inhibit global economic growth. With oil prices rising, the Canadian dollar became the only major currency that rose against the U.S. dollar on Tuesday. The US dollar index rose 0.16% to 92.96, hitting 93.17 earlier, reaching the highest level since April 1 this year.

Karl Schamotta, chief market strategist at Cambridge Global Payments, said the shift in relative growth expectations is weakening capital outflows from the United States and increasing the attractiveness of dollar-denominated investments; at the same time, the liquidation of speculative positions is forcing short-squeeze in the foreign exchange market. Pressure, pushing the dollar higher.

The euro fell 0.16% against the US dollar to 1.1781. It had previously fallen to 1.1755 US dollars, the lowest level since the beginning of April. The European Central Bank will announce its policy decision on Thursday.

The pound fell 0.34% to 1.3628 against the US dollar, falling for the fourth consecutive day; British Prime Minister Johnson announced Monday’s "Freedom Day", ending England’s more than one-year epidemic prevention restrictions, but this has been disrupted by a surge in the number of infected people. Traders said that the latest decline in the pound sterling is partly to blame for Catherine Mann, an economist who will join the Bank of England’s Monetary Policy Committee later this year, urging “not to act prematurely on austerity”. The euro rose against the pound for the fifth consecutive day, which lasted for the longest time in nine months, rising 0.2% to 0.86460

The U.S. dollar fell 0.53% to 1.2682 against the Canadian dollar. On Monday, the Canadian dollar fell to its lowest level in several months; Standard Chartered analyst Steven Englander wrote in a report to clients that the Canadian dollar’s performance was weaker than fundamentals, but the magnitude was not enough to trigger buying. According to our mid-term model, the deviation of the Canadian dollar from the estimated level on July 19 was 5%. At these prices, we are optimistic that the US dollar will fall against the Canadian dollar, but the enthusiasm of investors is not high. The Canadian dollar has depreciated by 3.5% since the beginning of July.

Commodity currencies linked to risk appetite, such as the Australian dollar and New Zealand dollar, have experienced difficult movements. As worries about the highly contagious variant of the Delta virus reignite, investors will either choose to hedge or stay on the sidelines. Delta virus is currently the world's major new coronavirus strain. The Australian dollar fell to its lowest level against the US dollar since the end of November last year, falling 0.2% in late trading to 0.7331; some analysts believe that the minutes of the Reserve Bank of Australia's policy meeting this month show that the central bank may change its decision to curtail its stimulus plan. Traders in New York said that the Australian dollar against the yen fell below the 80-yen mark where the barrier option strike price is located and was sold.

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