Dollar on Edge after Biden Revives Stimulus Hope

Dollar on Edge after Biden Revives Stimulus Hope

Nothing is going smoothly for the US dollar the past trading days. 

Today, Biden re-ignites hopes for a “robust” stimulus package that pushed the greenback further to the edge.

The president-elect mentioned that economic aid would be one of his main agenda during his first 100 days in office.

The measure is expected to help struggling businesses, households, and local governments amid the surging number of daily cases in the United States.

The country still tops the charts with the most number of cases. Some of the key states are reporting record-breaking single-day hikes.

According to the leader, the approval of the stimulus package together with other actions targeted to combat the persisting health crisis would be his focus in the coming days.

Consequently, House of Representatives Speaker Nancy Pelosi resumed talks with US Treasury Secretary Steven Mnuchin. 

This is the two key politicians’ first meeting in a while since the November 3 elections. The two parties are still unable to communicate their differences on the amount of the relief package.

Such an update is quick to add to the already strong risk-on sentiment dominating the market since last week.

The successive vaccine news ignited renewed confidence among investors to place their bets on riskier assets and away from safe-havens such as the US dollar and the gold.

The USD index, which tracks the performance of the world’s reserve currency against other leading monetary benchmarks across the globe, edged down by 0.16%. 

It settled at 91.148 points amid the boosted risk appetite among investors, hovering to its bottom-most settlement in two-and-a-half years.

During the overnight trading, it settled at 91.263 at one point of the session, which is its lowest in more than two years.

All Other Major Currencies Steadied

In the latest foreign exchange charts, the pound steadied against the greenback after clinching a 0.06% increase to $1.3422.

The positive developments in the post-Brexit deal provided much support to the GBP since last week. Spectators noted that the two parties have now entered the “tunnel stage” and are expected to settle before next week.

Consequently, other countries in different parts of the globe are also performing their best.

The USD JPY managed to record a conservative hike of 0.09% and calmed at its usual settlement above 104.

In Australia, the Aussie edged up by 0.18% and settled at 0.7382. The currency garnered a timely boost from the country’s GDP growth which stood at 3.3% quarter-on-quarter.

It surpassed analysts’ forecast of 2.6% growth for the period.

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