The euro gained in trading on Monday to $1.24 together with a recovery in U.S. stock futures gaining 1.4 percent after the sell-off on Friday.
The euro was trading at a two and a half week low of $1.2417 against the dollar.
Against the Japanese yen the dollar was at a 16 month low at 104.56 in early trading. This comes on investor concerns of a possible trade war.
The Australian dollar gained 0.6 percent at $0.7749.
The New Zealand dollar added almost 1 percent to $0.7297.
ECB and Fed
While in Germany, Jens Weidmann who is seen as the next European Central Banks president said that it is not unrealistic that there will be an increase in rates around the middle of next year. This is in line with market participant’s outlook.
Outlook Bullish for the Dollar
The Federal Reserve Bank has already raised interest rates with expectations from the bond markets that there will be further hikes during the year of over 100 basis points.
Fears of Trade War
Last week global markets were sent into a spin after President Trump imposed tariffs on Chinese goods. Fears of a trade war gripped the markets with all 3 major indexes falling.
On Monday markets bounced back up after news reports that the United States and China were in talks and have asked China to cut tariffs on U.S. autos and purchase more semiconductors. They also requested more access to the Chinese financial sector.
In London, U.S. stock futures gained 1.4 percent.
Against a basket of 6 major currencies, the dollar fell 0.3 percent.