Dollar Recovers in Asian Session

Barbara Zigah

USD DownThe US Dollar Index fell from a 2-month high during Asian trade on Friday as investors' concerns of a US economic recovery were eased by hopes of additional stimulus. Investors are hopeful that talks between Speaker of the House, Nancy Pelosi, and Steve Mnuchin, the Treasury Secretary, could soon resume and result in a second round of stimulus for those negatively affected by the Coronavirus pandemic. Insiders say that a package worth as much as $2.2 trillion could be voted upon as soon as next week. The latest labor data from the US showed that new unemployment claims unexpectedly rose for the week ended September 18th; the actual figure was 870,000 while analysts had predicted 843,000. Continuing claims was also higher than analysts had expected at 12.58 million against a forecast of 12.339 million.

In Tokyo trading as of 10:14 am, the US Dollar Index was trading at 94.3590 .DXY, up 0.01% and moving off the session trough of 94.313 .DXY; the Index had hit 94.601 .DXY yesterday, a 2-month high. The USD/JPY was higher at 105.5000 Yen, up 0.09%; the pair has ranged from a low of 105.364 Yen to a peak of 105.549 Yen.

Uncertainty Keeps Pressure on USD

Analysts say that the greenback will continue to face pressure for a number of reasons, not the least of which is the outcome of the presidential election in November. The President's negative response to the question of a peaceful transfer of power in the event he lost the election also has markets worried. Key members of the Senate GOP leadership have insisted that there will be a peaceful transition in January, if Trump loses. Whether the Democrats and Republicans are able to hammer out a stimulus package before then is also being called into question. 

Barbara Zigah

After working on Wall Street, Barb began her second career as a freelance writer at Daily Forex, where the CEO recognized fresh, untapped potential and was willing to give her a try. She’s never looked back. Since then, she’s worked steadily as a freelance writer and editor in the financial services and Forex-related industry.

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