The US dollar continued to extend its decline in the European session after being disappointed by a gloomy US manufacturing data reading.
The ISM survey showed manufacturing activity in the US contracted to a near 3-year low in March following a continued decline in new orders.
While all sub-components in the manufacturing PMI were below the 50 level (contraction) for the first time since 2009.
This grim figure has added pressure for the US dollar to shrink lower in line with the decline recorded in US 10-year bond yields.
Against most major currencies, the dollar index traded at a 2-month low of 101.96 at the start of the European session.
Following the weakness of the USD, the euro and the pound continued to take advantage of this opportunity to extend their gains higher.
This is seen in the movement of the euro trying to penetrate further the price level of 1.0900 which has been tested several times before.
The pound managed to climb higher to trade at its strongest level since June 2022 at around 1.2470 against the greenback.
Meanwhile, the New Zealand dollar surged to its highest level since mid-February, but the Aussie dollar fell following the Reserve Bank of Australia (RBA) meeting.
The RBA decided to keep interest rates unchanged at 3.60% and gave an indication that its cash rate is close to peaking.
In addition, the Canadian dollar continued to maintain its strengthening momentum to trade at a 2-month high against the USD.
Heading into the New York session, investors will focus on JOLTS data, US job openings as a lead to the NFP report due out later Friday.
