Let us check the market and the United States dollar’s situation.
There are uncertainties about a new fiscal stimulus package concerning the American economic recovery. It now continues to weigh down the market. The dollar slipped to a 27-month low in the previous session. Nevertheless, the United States dollar edged slightly higher on Wednesday.
The sterling was last quoted at $1.3236 and eased modestly from Tuesday’s eight-month high of $1.3241.
The Federal Reserve’s stimulus programs weakened the US dollar broadly. Nevertheless, it lifted US stock indexes to record highs. Thus, the US dollar hit fresh lows against most major currencies overnight.
The dollar was up by 0.15% in Asian trade at 92,340 against a basket of currencies.
Morimoto works at Sony Financial Holding. He said that the market was swamped with ‘stretched long positioning on the euro.’ Thus, that could also weigh down the currency.
Nevertheless, he said that the United States dollar selling is the trend for now. So, we can say that there is enough room for the euro to accelerate its rise.
Junto Morimoto is an analyst at Sony Financial Holdings. He said that there is a potent stimulus for investors to want to sell the United States dollar. Furthermore, he said that the United States dollar has been declining since last month.
The euro changed hands at $1.19305, going to its highest level since May 2018 in the previous session.
The United States dollar often functions as a safe-haven investment in times of crisis. There was a Federal Reserve’s intervention into financial markets to maintain liquidity during the COVID-19 pandemic.
The programs from the federal reserve have pushed riskier assets to all-time highs. Moreover, it reduced demand for safe-haven. This happened even as economic data has painted a bleak picture of the US’s recovery.
This is the current news of the market.