By Alun John

HONG KONG, (Reuters) – Overnight surges saw the euro and pound sit pretty in early Asia thanks to good U.K. job data and a general increase in investor sentiment on solid U.S. Retail sales and hope of easing China’s lockdowns.

In early Asia trade the euro common currency touched $1.0563 after it rose 1.1% overnight. This was its highest day of percentage gains ever since March.

After an overnight rally of 1.4%, Sterling reached $1.2501, the best day since late 2020. This was helped also by data which showed that Britain’s unemployment rate has fallen to its lowest level in 48 years.

These gains drove the against, which measures the greenback in relation to six peers, down as low at 103.18 in Early Asia. It was the lowest it had been in two weeks.

Carol Kong, currency strategist for Commonwealth Bank of Australia (OTC), said that the strong employment report gave the Pound a lift. “On top of this, there was a slight increase in the overall risk sentiment in financial market due to some positive news from China regarding the lockdowns, and strong data out of U.S..”

Shanghai achieved Tuesday its much-awaited milestone with three consecutive days without any new COVID-19 patients outside of quarantine zones. It also set its most precise timetable for releasing a lockdown on the previous day.

U.S. retail sales rose strong in April due to increased demand and more consumers buying motor vehicles.

Equities rose overnight, while U.S. benchmark Treasury yields increased, reflecting the elevated risk sentiment. They were at their lowest level since 2.9878%. [MKTS/GLOB]

Jerome Powell, Federal Reserve chairman, said that overnight the Fed “will keep pushing” on Tuesday to tighten U.S. money policy until it becomes clear that inflation is declining.

Although the dollar suffered a brief loss after Powell’s words, its slide continued.

As the Japanese currency is highly sensitive to US higher rates, the higher yields ended the small yen’s recovery. Today’s last yen exchange rate was 129.28 USD.

The Australian dollar gained 0.8% on Tuesday, thanks to the improvement in risk sentiment. It traded at $0.7035.

This was helped also by the minutes of a central bank meeting that were published Tuesday and suggested that the Reserve Bank of Australia might raise interest rates once again in June.

The cryptocurrency market was relatively quiet. The price of cryptocurrency was unchanged at $30,400.