US Dollar Near Six-Week Low – is More Stimulus Coming Soon?

The US dollar is holding its ground against its major peers on Thursday with traders awaiting confirmation on the coronavirus relief package before placing their moves. At the time of writing, the US dollar index DXY is trading around 92.76.

During the previous session, the US dollar dipped to the lowest levels in over a month after House Speaker Nancy Pelosi and US President Donald Trump indicated progress towards finalizing the next round of fiscal stimulus measures soon. This helped boost the market sentiment, causing traders to move away from the safety of the greenback and towards riskier instruments.

Even though Senate Republicans remain opposed to the fresh stimulus package, Nancy Pelosi expressed hope before her discussions with Treasury Secretary Steven Mnuchin that the deal could be finalized soon. However, she hinted that it may only get passed after the presidential elections on November 3.

The US dollar also came under pressure after the GBP soared to the highest levels in six weeks over optimism about Britain-EU talks on a post-Brexit trade deal. Britain’s chief negotiator Michael Gove confirmed that both sides would continue their discussions later today, raising hopes for a trade deal to be worked out soon, avoiding the risk of a no-deal Brexit.