The dollar fell against the major counterparts, today, Thursday, as demand for safe-haven currencies was undermined by optimism that a large stimulus package pumped by the new US administration will boost growth.
Commodity-related currencies received a boost as Asian stocks tracked their US counterpart to record highs, after Joe Biden was sworn in as president. Biden announced an aid package to mitigate the repercussions of the Corona pandemic, worth $ 1.9 trillion.
“Risk sentiment is very positive now, and we expect it to remain so this year, as growth is expected to pick up very strongly,” said Shinichiro Kaduta, chief currency analyst at Barclays Capital in Tokyo.
He added that the Canadian dollar and the Norwegian krone would likely perform better than the rest of the market, while European currencies would lag behind.
He said that the US currency should rise this year against the euro, as the United States is recovering faster than most other countries.
The dollar index fell 0.2 percent to 90.268 points, dropping for a third day since touching nearly a month’s high of 90.956 on Monday.
The US dollar fell 0.2 percent to 1.2611 Canadian dollars in Asia, to decline for a third day. It touched a three-year low of 1.2607 Canadian dollars overnight after the Bank of Canada chose not to cut interest rates.
The dollar fell 0.4 percent to 8,456 Norwegian kroner, which is also the third day of decline.
The Australian dollar rose 0.4 percent to 77.74 US cents, adding to a 0.7 percent rise in the previous session. Data released on Thursday showed that Australia recorded another strong hiring increase in December.
The dollar lost 0.2 percent to 103.59 Japanese yen, another safe-haven currency, today, after falling to a two-week low of 103.33.
The euro gained 0.2 percent, to reflect a similar decline recorded in the previous session, to trade at $ 1.2135.