AUD/USD erases the slight decline from earlier to push back up to 0.7775
As such, buyers hold near-term control but will have to try and work past the swing highs yesterday at around 0.7780 first before challenging the 0.7800 level next.

Not a whole lot going on thus far
European indices are posting slight gains so far on the session while US futures are seen up 0.2%, as risk tones keep steadier and calmer after the bounce yesterday.

RKI president, Lothar Wieler, warns against virus variants
That is not too comforting and this will be a risk to watch out for as major economies start to progress with the reopening ahead of the summer. There is already a growing fear in the UK over the India COVID-19 variant in the past few days and

Latest data released by Markit/CIPS – 21 May 2021
Pent-up demand is the obvious driver here although strong price pressures are still a downside to note in this report, much like everywhere else at the moment.

Forex news from the European trading session – 20 May 2021
Headlines:
Markets:
– CHF leads, USD lags on the day
– European equities higher; S&P 500 futures down 0.2%

Will dip buyers step back in once again later today?
European indices are slightly higher but that owes more to a catchup in the late bounce to US stocks yesterday rather than any positive sentiment.

Latest data released by CBI – 20 May 2021
– -8
– Trends selling prices 38
– Prior 27
UK factory orders jump to their highest since December 2017 as the reopening continues to fuel stronger economic prospects in Q2. That said, businesses continue to fear supply chain bottlenecks and that is leading to strong input/output price inflation.

Remarks by ECB chief economist, Philip Lane
He’s not entirely wrong in that regard but complacency also breeds contempt, that’s always important to remember. When it comes to rising input cost inflation, the simplest explanation may also be the best one (Occam’s razor).

Remarks by BOE policymaker, Jon Cunliffe

Latest data from the Mortgage Bankers Association for the week ending 14 May 2021
Overall, housing market conditions have met a bit of moderation after having run hot last year as evident with the trend in purchasing activity over the past few months.