Dollar flat, euro bumps higher as sentiment see-saws
The dollar held steady on Thursday as investors were cautious over expectations about a COVID-19 vaccine that is unlikely to avert a grim winter in the United States and Europe as the pandemic’s latest wave intensifies.
The dollar index was up 0.01% in the morning in New York, after having rebounded a little in London from lows during Asia trading.
U.S. Treasury yields slumped, in line with Europe, weighed down by the rise in coronavirus cases around the world and data showing inflation going nowhere in the United States.
The questions come amid possibly shifting views about the U.S. dollar’s role as a safe haven or as a ticket to gains from a strengthening global economy, he said. The euro bumped higher by 0.14% to $1.1796.
The euro is trying to find its feet “after the vaccine-related storm of activity at the start of the week, and after the U.S. election news,” said Jane Foley, head of FX strategy at Rabobank. The euro, Chandler noted, has been trading between $1.16 and $1.20 since late July.
“Being in the middle of a range makes nobody happy. Bulls nor bears can be happy,” he said.
Europe is grappling with surging infections and new COVID-19 restrictions, with Germany’s economic advisers trimming next year’s growth outlook. In the United States, cases continue to hit record levels.
The dollar’s strength in the past week has for now put the brakes on a long drop for the greenback, which had shed about 10% against a basket of currencies between March and the announcement of progress on Pfizer Inc’s COVID-19 vaccine on Monday.
Sterling licked its wounds as trade talks between Britain and the European Union seemed set to drag on past yet another deadline, raising the prospect that no trade deal may be reached before Brexit transition arrangements end on Dec. 31.
The British currency last traded 0.5% lower to the dollar at $1.3149.
Reference: CNBC
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