The US dollar is exhibiting signs of weakness, sliding lower against its major peers as the market sentiment receives a boost from emerging news reports about the progress towards developing a vaccine against COVID-19. At the time of writing, the US dollar index DXY is trading around 99.68.

While commodity currencies are making gains against the US dollar supported by a rise in crude oil prices, the euro has also strengthened after France and Germany suggested the creation of a recovery fund worth 500 billion euros to support the worst affected regions in Europe. Amid a decline in volatility, the greenback has been on the decline while traders move towards riskier currencies.

However, the US dollar remains supported over worries about a possible second wave of coronavirus cases in economies that are soon to reopen. Similar instances have been observed in countries like China, South Korea and Germany, and any resurgence in the number of infections could once again impede economic recovery.