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The dollar stabilized against most currencies on Friday after a balanced presidential debate in the United States but is heading towards a weekly loss as investors await stimulus talks in Washington and post-Brexit trade negotiations.
US President Donald Trump adopted a more conservative tone compared to what he was in the first debate, but Thursday’s debate focused again on dealing with the Covid-19 pandemic and personal insults.
The dollar fell 0.03% against a basket of currencies in early trade in Europe, near a seven-week low it reached on Wednesday. The dollar is still down around 0.7% for the week.
The euro was little changed against the dollar at 1.1818, as was the pound at $ 1.3084.
The safe-haven yen rose nearly 0.1% to 104.71 for the dollar, trimming some of the losses it incurred on Thursday after US House Speaker Nancy Pelosi said stimulus talks were making progress.
Hopes that Congress may pass a stimulus package ahead of the presidential election and confidence that spending may follow, regardless of who is elected, have led to a wave of selling in the bond market in anticipation of inflation and government borrowing.
The Chinese yuan also held onto its gains against the dollar after an official with the State Administration of Foreign Exchange in China said that the Chinese currency is more stable than expected, indicating that the authorities are not too concerned about its recent appreciation.
The yuan has gained about 7.5% since the end of May, as China leads the global recovery from the Coronavirus. And it recorded in the last transactions of 6.6884 for the dollar in internal trading, down about half a percentage point from the 27-month peak it hit on Wednesday.
