TOKYO (Reuters) – The dollar fell to multi-year highs against many currencies on Wednesday as currency traders overlooked new delays in U.S. stimulus analyzes and maintained a bet that additional financial support remained likely.
The greenback hit its weakest point in more than two years against the euro, the Australian dollar and New Zealand. The greenback also fell to its lowest level in more than five years against the Swiss franc and fell sharply against Asian currencies.
U.S. Senate Visiting Chief Mitch McConnell on Tuesday blocked immediate consideration of a step to increase COVID-19 relief payments to $ 2,000, adding another twist to false talks about fiscal stimulus.
The dollar has fallen steadily since U.S. President Donald Trump signed a coronavirus support and consumption bill on Sunday, as increased stimulus for the world’s largest economy reduces reduced demand for safety. see maintaining the green background.
While the size of relief payments remains uncertain, many analysts say the dollar is likely to start falling next year as President Joe Biden is expected to push for even more economic support measures.
“Our weak dollar call remains intact as we move into 2021,” analysts at BBH wrote in a research memo.
“What happens to the greenback … depends largely on how well the United States takes control of the virus in 2021 as well as the outlook for further fiscal stimulus. ”
The dollar fell to $ 1.2295 per euro on Wednesday in Asia, the weakest level since April 2018.
The British pound rose to $ 1.3543.
Against the Swiss franc, the dollar hit 0.8819, the weakest since January 2015.
The dollar fell to 103.27 yen.
Low liquidity may have caused too many market movements with many investors away for the year-end holidays.
Asia’s light data calendar also tends to leave traders with little incentive to take out big positions.
The dollar index against a basket of six major currencies was at 89.759, near its lowest level in more than two years.
Last-minute breaches have called into question some details of the U.S. aid package, but many analysts say the U.S. government will withhold fiscal stimulus in the form of somehow as the second wave of coronavirus diseases becomes a major threat to the economy.
In addition, many investors are looking forward to a new government under Biden when it is introduced on January 20th.
Another negative factor for the greenback is the expectation that the U.S. Federal Reserve will keep interest rates low for a very long time, many analysts say.
Elsewhere, both the Australian dollar and the New Zealand dollar reached their strongest levels in 2 1/2-years. These currencies are considered to be bars of risk appetite due to their connection to global commodities.
The Yuan landed at 6.5227 per dollar. The Korean won and the Malaysian ringgit also rose amid widespread dollar sales.
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Cash offer prices at 12:02 PM (0302 GMT)
RIC Description Last US Close Pct Change YTD Pct High Bid Low Bid
Previous change
Session
Euro / Dollar $ 1.2287 $ 1.2251 + 0.29% + 9.60% +1.2295 +1.2250
Dollar / Yen 103.2750 103.4850 -0.17% -4.89% +103.5800 +103.2950
Euro / Yen 126.89 126.86 + 0.02% + 4.05% +127.1300 +126.8600
Dollar / Switzerland 0.8827 0.8841 -0.15% -8.77% +0.8842 +0.8820
Sterling / Dollar 1.3543 1.3502 + 0.32% + 2.13% +1.3544 +1.3495
Dollar / Canada 1.2796 1.2814 -0.13% -1.49% +1.2827 +1.2797
Aussie / Dollar 0.7641 0.7606 + 0.47% + 8.91% +0.7642 +0.7604
NZ 0.7171 0.7148 + 0.35% + 6.60% +0.7176 +0.7148
Dollars / Dollars
Reciting with Stanley White; Edited by Sam Holmes and Stephen Coates