US Dollar Falling as Vaccine Optimism Recedes and Yen Towards Worst Week Since March

The dollar fell on Friday and risk appetite dwindled in currency markets, as concerns about the economic consequences of the spike in COVID-19 cases in Europe and the United States dampened initial enthusiasm about a possible vaccine.

Global markets rose on Monday after Pfizer said its experimental vaccine was more than 90% effective, a news that led to the dollar’s rise as traders closed their credit positions in the yen.

But dealers became more risk averse on Thursday and Friday, after the Presidents of the US Federal Reserve and the European Central Bank stressed that the economic outlook was still clouded by uncertainty.

The dollar fell in early trade in London, about 0.1% during the session to 92.884 against a basket of currencies.

The safe-haven yen, which fell nearly 2% against the dollar on Monday, continued to recoup some of its losses, rising about 0.1% to 105.07.

Despite the rally, the yen was still heading for its worst week since March.

The Australian dollar, an indicator of liquidity in risk, generally stabilized during the session and fell slightly during the week as caution about the economic fallout of the virus outweighed optimism about a vaccine.

The New Zealand dollar fell 0.2% against the dollar to 0.6823, but rose in the week after jumping to its highest level since March 2019 after the Reserve Board meeting on Wednesday.

The euro rose slightly during the session to $ 1.18105, ahead of the release of GDP data for the Eurozone.

Against the safe-haven Swiss franc, the euro extended the gains it made earlier in the week, rising more than 1% for the week, to 1.08105.