It is been a period that has been largely characterized by ‘risk off’ trading. If we look at the FX performance tracker for the past month, the three best performers in the G10 have been the traditional safe-havens. The swiss franc, Japanese yen, and US dollar - in that order. Meanwhile, the higher risk currencies, including the Norwegian krone and Australian dollar, have largely underperformed.
This has a lot to do with the aggressive spread of the delta variant of the COVID-19 virus around much of the world. We’re seeing relatively sharp increases in infection in many nations, including some of the major ones. The real cause for concern is the sharp uptick in contagion witnessed in those nations that have so far lagged behind in vaccinations.