The dollar increased from two and a half year lows


The U.S. dollar increased from two and a half year lows as uncertainties about an agreement on U.S. coronavirus aid and Brexit trade negotiations deflated investor confidence.

On Friday, the U.S. congress seemed unlikely to agree on $900 bn in new coronavirus aid. They may pass a third stopgap spending bill to keep the government from shutting down at night.

On Friday, the EU announced a few hours left to strike a Brexit trade deal. The United Kingdom called on the bloc to see sense as the two sides race to avert a turbulent finale to the Brexit crisis.

According to senior foreign exchange trader and strategists at Tempus, Juan Perez, Brexit is a major risk item that is not being resolved. It destroys the whole global stability narrative and supports the greenback. Perez also announced that the lack of a U.S. stimulus resolution and increasing global coronavirus deaths are also fueling the flight to safe-haven assets.

The U.S. dollar index boosted by 0.21% and settled at 90.0190, after sinking to 89.822 on Thursday.

Additionally, on Friday, Wall Street withdrew from record highs as a Covid-19 stimulus deal remained focused ahead of a weekend deadline. At the same time, Tesla shares hit a lifetime high in anticipation of their addition to the S&P 500 next week.

Additionally, President Joe Biden’s incoming chief economic adviser announced on December 18 that a COVID relief plan under negotiation in Congress should not involve a provision that would restrict the Treasury Department’s capability and the Federal Reserve to struggle with economic crises.

Brian Deese will head the White House National Economic Council for Biden. According to him, we are witnessing an unprecedented economic crisis. In this situation, it is in the American people’s interests to keep the Fed’s ability to respond swiftly and forcefully.

The pound declined by 0.60% against the dollar while the euro fell 0.25%

The British sterling declined by 0.60% and settled at $1.3505. It pulled back from a two and a half year high against the dollar. It had an additional two and a half week high against the euro as the Brexit talks resumed.

Furthermore, the euro declined by 0.25% and touched $1.2240 against the greenback. It increased by 0.33% versus the pound at 0.9060.

The world’s largest cryptocurrency was traded near $22,732.78, down 0.24% after hitting its lifetime high. Investors remain focused on BTC.

Rising expectations have also driven the 2020 rally. It will become a mainstream payment method, with PayPal opening its network to cryptocurrencies.

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