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20/12/30_Dollar fell to the lowest value in the last 2 years

The dollar fell to its lowest value in more than two years on Wednesday and risky currencies rose sharply as investors took note of delays in fiscal stimulus in the US and bet that in 2021 the willingness of global market risk would increase.

 

US Majority Senate leader Mitch McConnell blocked a vote to increase COVID-19 relief payments to $ 2,000 on Tuesday, further delaying unpleasant negotiations on fiscal stimulus.

 

However, market sentiment was positive as investors remained optimistic that an agreement on fiscal stimulus would eventually be reached, reducing demand for the safe-haven currency – dollar.

 

Analysts expect the dollar to weaken further in 2021 as newly elected US President Joe Biden is expected to push for even more measures to support the US economy.

 

At 09:16 CET the dollar fell 0.1% against a basket of currencies to 89.895, overnight fell to 89.711. The euro rose to $ 1,226.

 

The Australian dollar rose 0.6% to 0.76475 at 9:25 CET. The New Zealand dollar also reached two-year highs.

 

The dollar also lost to the Japanese yen, with the dollar-yen currency pair falling 0.2% to 103.34 at 8:34 CET.

 

In Europe, Britain sparked sentiment, becoming the first country in the world to approve the COVID-19 vaccine developed by AstraZeneca and Oxford University.

 

The British pound against the dollar was at the level of 1.3538 USD and did not change much against the euro.

 

The Brexit agreement is also an important stimulus for the pound. Chief Monetary Strategist Elias Haddad of the Commonwealth Bank of Australia wrote in a note to clients that the fact that the agreement does not provide a framework for equivalence for financial services and growing support for Scottish independence are a new adversary of the pound.

 

 

Source: Reuters.com

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