Dollar index hovers near 32-month low as US stimulus negotiations continue
|- The dollar remains on the offer near multi-month lows against major currencies.
- Congress leaders vow to reach the long-awaited stimulus deal this year.
The dollar index (DXY) consolidates near 32-month lows reached Tuesday as the US Congress doubles down on efforts to break the long-standing stimulus impasse.
The DXY, which gauges the greenback's value against majors, is currently trading near 90.48, having printed a low of 90.42 on Tuesday. That was the lowest level since April 2018.
Senate Democratic leader Chuck Schumer was out on the wires a few minutes ago, stating that lawmakers are still talking on the coronavirus relief package and more talks are likely tonight (Tuesday, Eastern time).
Early today, House of Representatives Speaker Nancy Pelosi, a Democrat, hosted Senate Majority Leader Mitch McConnell, a Republican, as well as Senate Democratic leader Chuck Schumer and House Republican leader Kevin McCarthy, at the 7:30 p.m. ET (0030 GMT) gathering for stimulus discussions.
The negotiations have gone far too long, leaving the US economy vulnerable to downside shocks from the resurgence of coronavirus. Even so, risk assets have managed to stay bid, keeping the dollar under pressure. Expectations for global recovery on potential vaccines have kept investors from selling risk.
However, if the fiscal impasse persists, the focus could shift to near-term economic risks, possibly leading to risk aversion and a bounce in the safe-haven greenback.
Congress leaders, however, have vowed to reach a stimulus deal this year, which could be attached to the government funding bill. Most investment banks expect the dollar to continue losing ground in 2021.
Technical levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.