The euro steeply fell against the dollar hitting parity, as investors sought refuge amid growing recession fears and the looming energy crisis in Europe, while EU political leaders appeared to be not up to the task. ZEW Survey from Germany and business sentiment showed on Tuesday a further deterioration of the business climate.
The British pound broke below the 1.20 level as uncertainties over Northern Ireland protocol and the ongoing political crisis in the UK showed no signs of abating after Prime Minister Boris Johnson decided to resign.
The Japanese yen continued to weaken against the dollar with the currency pair surpassing the 137.00 level on Monday.
Gold prices fell further but consolidated around $1730 per ounce. The strengthening of the US dollar accompanied with aggressive monetary policies of major central banks is exerting irresistible pressure on non-yielding gold.
All major US stock indexes were little changed last week. Following the three-day rally before the weekend, all gains were canceled on Monday and Tuesday ahead of the Q2 earnings season. As is tradition the big investment banks will be among the first to report.
Oil prices dropped. A stronger greenback and renewed COVID-19 restrictions in China weighed on prices. U.S. President Joe Biden will make the case for higher oil production from OPEC countries when he meets Gulf leaders in Saudi Arabia this week.