Dollar weakens on improving risk sentiment, coronavirus concerns remain

NEW YORK: The dollar fell on Monday as stocks opened higher, indicating improving risk sentiment despite a rise in coronavirus cases.

Wall Street’s gain came after a sharp drop on Friday.

“It’s a weak start for the US currency, I think it’s mostly risk on,” said Joe Manimbo, senior market analyst at Western Union Business Solutions in Washington.

Investors have been weighing better economic data against a new uptick in Covid-19 infections.

The global death toll from the virus reached half a million on Sunday. Cases surged in southern and western US states, prompting California to order some bars to close in a rollback of efforts to reopen the economy.

The next major US economic focus will be Thursday’s jobs report for June.

US employers are expected to have added 3 million jobs during the month, according to the median estimate of economists polled. Projections vary widely between economists, however, from as few as 405,000 jobs to as many as 9 million.

The dollar index was last down 0.21% at 97.27.

The greenback may get some boost from quarter-end demand later on Monday or on Tuesday, after underperforming this quarter, analysts said.

The euro gained 0.47% to US$1.1270.

The dollar gained 0.21% against the Japanese yen to 107.44 yen.

Sterling weakened to a one-month low against the greenback on concerns about how Britain’s government will pay for its planned infrastructure programme.

There are also doubts about whether Britain will seal a trade pact with the European Union as little progress has been made in agreeing Britain’s future relationship with the bloc, which it exited on Jan 31.

The pound was last down 0.26% at US$1.2301. – June 29, 2020, Reuters

Subscribe and get top news delivered to your Inbox everyday for FREE