US Dollar Recovers After Weakening as Stimulus Talks Head Nowhere

US Dollar Recovers After Weakening as Stimulus Talks Head Nowhere

Posted Thursday, August 13, 2020 by
Arslan Butt • 1 min read

The US dollar is recovering slightly after losing ground against other major currencies early on Thursday as markets worry that negotiations on the coronavirus relief bill are failing to reach any positive conclusion so far. At the time of writing, the US dollar index DXY is trading around 93.30.

Additional weakness in the US dollar was caused by a decline in US Treasury yields. However, traders appear cautious keeping the losses limited, in hopes that discussions between Democrats and Republicans will finally resolve concerns and enable the finalizing of the next round of fiscal stimulus measures.

During the previous session, both sides blamed each other for the delay in not getting the bill ready yet, driving the greenback lower by 0.3% against a basket of currencies. On Wednesday, President Donald Trump also stepped in, pointing the finger of blame on Democrats for not being interested in negotiating the fresh round of stimulus under consideration.

Meanwhile, the Euro continues to gain against the US dollar over hopes that the European economies are working towards recovery after the pandemic, even as the pound holds steady.

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