Dollar Appreciates As Virus, Stimulus Concerns Weigh
15 October 2020 - 6:23PM
RTTF2
The U.S. dollar strengthened against its major rivals in the
European session on Thursday, as uncertainty over a U.S. stimulus
package and a rapid rise in coronavirus cases across Europe lifted
the appeal of the safe-haven assets.
Treasury Secretary Stephen Mnuchin cautioned that the stimulus
package is unlikely to pass before the election, as the two sides
remained far apart on certain issues.
Mnuchin blamed Democrats for the deadlock, adding that it is
"part of the reality."
Risk sentiment was undermined by rising cases of coronavirus in
some regions of Europe and return of restrictions to contain the
outbreak.
France has introduced curfews and other European nations are
closing schools and cancelling operations due to COVID-19.
The two-day European Union summit will kick off later in the
day, with Brexit talks on the agenda.
EU leaders will re-examine the post-Brexit talks as the deadline
for a pact on the European Union's relations with Britain
nears.
Economic reports on weekly jobless claims, regional
manufacturing activity and import and export prices are due later
in the day.
The greenback appreciated to 1.2930 against the pound from
Wednesday's closing value of 1.3012. The greenback is poised to
find resistance around the 1.28 area.
The greenback reached as high as 1.1703 against the euro, which
was its strongest level since October 2. The greenback is seen
finding resistance around the 1.16 level.
After falling to 0.9127 at 1:45 am ET, the U.S. currency edged
up to 0.9156 against the Swiss franc. Next key resistance for the
greenback is seen around the 0.94 region.
The greenback was higher against the yen, at 105.34. Further
rally may lead the greenback to a resistance around the 108.00
level.
Reversing from its early lows of 1.3138 against the loonie,
0.7170 against the aussie and 0.6663 against the kiwi, the dollar
spiked up to a 1-week high of 1.3207, more than 2-week high of
0.7067 and a 6-day high of 0.6592, respectively. On the upside,
1.37, 0.68 and 0.63 are possibly seen as its next resistance levels
against the loonie, the aussie and the kiwi, respectively.
Looking ahead, the U.S. weekly jobless claims for the week ended
October 10, New York Fed's empire manufacturing survey for October
and import and export prices for September will be featured in the
New York session.
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