Forex

Dollar Nears 2 Years Low Over Doubts on Economic Recovery

Dollar Nears 2 Years Low Over Doubts on Economic Recovery

On Wednesday, the greenback currency was hovering around its two-year-low in early European trade sessions amid the gloomy doubts over the Federal Reserve meeting, concluding on 29 July, and slow US financial recovery.  

The Dollar Index, that measures the US currency against six other significant currencies, saw a 0.2% plunge at 93.507. The currency is only slightly above the 93.448 low, seen in May 2018. The greenback is continuously going against both safe and risky pairs. GBP/USD traded 0.1% higher at 1.2946, USD /JPY fell by 0.1% at 104.97, and EUR/USD traded at 1.1753 or 0.3% higher.

Although some US nations show positive signs about vanishing COVID cases in previous hotspots, four US states reported the record number of cases in the south and west in corona deaths on Tuesday.

The doubts regarding the time of the release of the next economic package and the question mark over the national economic recovery are hurting the US dollar.

Democrats have proposed a relief package of more than $3 trillion while the Republicans have called for a $1 trillion relief proposal in the US Senate, against which some of its own members are rallying. 

Meanwhile, Goldman Sachs says that the greenback’s dominance as a reserve currency in the world is under threat now and the leading opponent here is European currency.

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