Dollar soft as traders expect stimulus

The dollar drifted toward posting its softest week in more than a month on Friday, as revived hopes for a new U.S. stimulus package to boost the world’s biggest economy had investors seeking out riskier currencies.

Against a basket of six majors, the dollar held near a one-month low in Asia and has slipped 0.9% this week, its largest weekly loss since late August.
Dollar soft as traders expect stimulus and await U.S. jobs data

The New Zealand dollar made a fresh one-week peak of $0.6659, while the euro and Aussie held just below week highs made overnight.

Moves in morning trade were small, however, with signs of an impasse on Capitol Hill and the risk of disappointment at U.S. jobs data due later in the day holding investors back.

U.S. House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin failed on Thursday to bridge what Pelosi described as differences over dollars and values.

Analysts view their talks as a last-gasp effort to secure relief ahead of the Nov. 3 election for tens of millions of Americans and business including U.S. airlines, which have begun furloughing over 32,000 workers.

“Markets surely remain susceptible to the lack of a deal this side of the election,” said National Australia Bank’s head of foreign exchange strategy, Ray Attrill.

The risk-sensitive Australian dollar was last steady at $0.7182 after climbing as high as $0.7209 overnight. It has so far posted a weekly gain of 2.2%, its best since late August.

Read more at POSTHASTE

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