On Wednesday, the dollar plunged to almost three-month lows, as signs the Federal Reserve is gearing up to adjust its bond-buying scheme and better than planned unemployment figures did little to drum up safe-haven support for the reserve currency of the world, signalling a further fall is on the horizon.
USD Index Down
The U.S. dollar index fell to 91.93 by 0.31 percent, which measures the value of the greenback versus a six foreign currencies trade-weighted basket.
The minutes of the Fed’s Nov. 4-5 meeting showed that policymakers from the Federal Reserve explored a number of bond buying options to support the recovery, including increasing the purchase pace or moving priority to longer-term bonds.
The central bank seems to be keeping its asset purchases on autopilot for the time being, although the plan is supposed to be outlined at upcoming meetings.
Many participants felt that the Committee would like to improve its advice on the acquisition of properties fairly quickly.
The ability to adhere to the new ultra-loose monetary strategy for the first time since July falls in the wake of surveys indicating a back-to-back increase in weekly jobless claims.
USD Demand unlikely to increase soon
But it is doubtful that the suggestion of labour market weakness-ahead of next week’s monthly jobs survey-and the effect on the economy of the Covid-19 cases would spur demand for the dollar as the optimism about the vaccine-led outlook is likely to continue.
The dollar is starting to fall from grace with the benign danger environment (for the first time the Dow Jones hit 30,000) and the bullish forecast for the 2021 post Covid-19 rebound, causing further flows from the dollar to cyclical FX, with the trade-weighted dollar continuing to weaken.
With the benign danger landscape (the Dow Jones reached 30,000 for the first time) and the bullish forecast for the 2021 post Covid-19 rebound, the dollar begins to slip from grace, triggering more flows from the dollar into cyclical FX, with the trade-weighted dollar continuing to sink lower.
Dont miss Bitcoin Price Drops Failing to Reach New Highs.
To find the best stocks and trading and financial news, check out Bitcoin Investment News. Make sure to also keep tabs on Crypto Asset’s guides and news.
