Major currencies fluctuated during Friday’s trading session. The pound rose against the U.S. dollar and the euro. It held steady at $1.2465 on Friday, heading for a 1.6% gain this week. The sterling strengthened after British Prime Minister Boris Johnson left intensive care following his hospitalization for coronavirus symptoms.
Meanwhile, an agreement between Saudi Arabia and Russia to cut oil supply has failed to reduce concerns about massive oversupply, causing traders uncertainty. But currencies from oil-producing countries maintained their strength against the U.S. dollar so far.
The Australian dollar surged forward by 5.5% versus the dollar last week as stress was easing in global markets. Because of Australia’s dependence on the global commodities trade and China, the Aussie is highly sensitive to risk sentiment.
While the Canadian dollar, the Russian ruble, and the Norwegian crown were all higher against the U.S. dollar in the previous week, experts doubt that they’ll gain further.
What about the U.S. dollar?
The U.S. dollar fell on Friday’s session due to the Fed’s new program. Signs of a slowdown in the coronavirus pandemic also reduced safe-haven demand, further weakening the dollar.
The greenback last traded at $1.0930 against the euro. And it was down 1% against the Swiss franc, trading at 0.9660. The U.S. currency has also lowered against the Japanese yen at 108.51.
The U.S. Federal Reserve announced about a $2.3 trillion program to offer loans to local governments and mid-sized or small businesses on Thursday. It’s the agency’s latest attempt to boost the U.S. economy while the country fights the coronavirus crisis.
The Fed had taken a lot of different measures to increase the supply of dollars – stated Junichi Ishikawa, the senior FX strategist at IG Securities in Tokyo. According to the analyst, the end result of the Fed’s actions is gradual weakening the dollar.