Forex – Dollar Weakens as Risk – FxPremiere.com – The dollar has been on the back foot Tuesday.
At 3:10 AM ET (0710 GMT), the U.S. Dollar Index, which tracks the greenback against a basket of six other currencies; stood at 100.235, down 0.5%, with the loonie, Aussie and kiwi all rising over 1%. USD/JPY fell 0.3% to 108.88, while EUR/USD rose 0.6% to 1.0859.
Spain’s daily death toll fell on Monday for the fourth day running to 637, its lowest level since March 24, while Italy reported 525 deaths on Sunday, the fewest since March 19 (although deaths ticked up again on Monday).Forex – Dollar Weakens as Risk
The euro will be in focus later as eurozone finance ministers hold a teleconference call to discuss strategies for funding the region’s policy response to the virus. Various ideas and schemes are competing for attention, but the desire of Spain and Italy for jointly-issued and guaranteed ‘coronabonds’ is likely to be rejected by Germany, the Netherlands and others.
The price of oil has become another factor impacting the strength of the dollar. “USD and oil have become an increasingly uneven relationship; with US oil production now a key liability for USD,” said Danske Bank, in a research note.
Looking at Thursday’s meeting of the major crude producers to discuss a reduction of supply, “we think risks are tilted towards a disappointment and expect Brent oil to stay sub-USD40/bbl. This could fuel USD/JPY moving towards 106 again near term,” Danske added.
The dollar also gave up ground against most emerging market currencies, with the Chinese yuan rising around half a percent.