Let us check the market. There are fading hopes for additional economic stimulus, while inflation figures surprised to the upside. Thus, on Thursday, in early European trade, the United States dollar weakened.
The dollar index tracks the greenback against a basket of six other currencies. So, at 0700 GMT (3 AM ET), the dollar index was down 0.3% at 93.157. USD/JPY pair decreased 0.2% at 106.72, EUR/USD rose 0.4% at 1.1826, and GPB/USD was up 0.3% to 1.3066.
The inability of the United States lawmakers to come to any sort of consensus regarding the country’s latest Covid-19 stimulus package has been weighing on the greenback. The agreement is a deal that many feel is necessary to keep the economic recovery on track.
On Wednesday, the United States President Donald Trump accused Democrats of not wanting to negotiate over the package, with Democratic and Republican negotiators trading blame and barbs as negotiations ended without a result for the fifth day.
Richmond Fed President Thomas Barkin, on Tuesday, stated that the economy could take another downturn if United States policymakers fail to provide more financial aid.
Federal Reserve Bank of Boston President Eric Rosengren backed him up Wednesday. Thus, he said that he ‘strongly’ supports taking additional fiscal action. And it is to help households and businesses survive the crisis. Moreover, Rosengren added that more robust efforts should be combined with more spending to contain the virus.
Covid-19 deaths in the United States topped 166,000 as of August Thirteen. Moreover, the confirmed cases raised by more than 4% in the past week. It is according to data collected by Johns Hopkins University.
The latest inflations figures, with substantial numbers, both the producer and consumer sides added to all those problems.
Jefferies (NYSE: JEF) said in a note that the 0.6% month-on-month increase in July core CPI was jaw-dropping. Furthermore, since January 1991, it was the most massive sequential jump.
That is leading news of the market.
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