US Dollar Trades Close to Lowest Level Since March 2018

The US dollar continues to trade bearish, falling to a near three-year low on the back of a Democrat victory in the Georgia Senate elections

US Dollar Trades Close to Lowest Level Since March 2018

Early on Thursday, the US dollar continues to trade bearish, falling to a near three-year low on the back of a Democrat victory in the Georgia Senate elections. At the time of writing, the US dollar index DXY is trading around 89.55.

The Democrat victory in the two seats from Georgia gives the party a majority in the US Senate, which will allow President elect Joe Biden to pass key legislation with ease. While the victory has boosted market sentiment, it has driven the US dollar weaker over expectations that the Democrats could hike taxes and roll out more stimulus measures.

The protests at the Capitol, however, failed to make an impact on the US dollar with forex traders focusing completely on the election results instead. While the Democrat victory does increase the prospects of economic growth in the US, more stimulus could weaken US bond yields and the greenback as it could increase the country’s budget and trade deficits further.

During the previous session, the dollar fell to 89.206 against its major rivals – the lowest level seen since March 2018. Meanwhile, the 10-year Treasury yields surged to 1.054% – the highest level seen since mid-March when the coronavirus pandemic began to impact the US and most parts of the world.

 

ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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