Biden’s Comments On The Trade Deal Halted Losses in The Dollar And Reinforced The Decline of Chinese Yuan

The dollar settled near its lowest level in two and a half years Wednesday, December 2, as investors assess the prospects for further fiscal stimulus in the United States, while riskier currencies held onto their gains as investor confidence improved.

The Chinese yuan lost some of its gains in Asian transactions overnight after the New York Times reported that US President-elect Joe Biden would not immediately move to cancel the Phase 1 trade deal that President Donald Trump struck with China.

The dollar index declined to 91.19 against a basket of currencies, close to its lowest level since the end of April 2018, which it reached in the evening.

The euro and the New Zealand dollar stabilized after they jumped overnight to their highest level in two and a half years, with the dollar widely depreciating due to renewed hopes for a coronavirus vaccine and US financial stimuli.

US Treasury Secretary Stephen Mnuchin and House Speaker Nancy Pelosi held talks on the stimulus for the first time since the presidential election, while a group of senators and lawmakers from both parties proposed a $908 billion package of measures to mitigate the repercussions of the Covid-19 pandemic. The dollar traded against 104.41 Japanese yen.

The euro held onto some of its gains against the dollar after a strong overnight performance, as it hit its highest level since May 2018. It recorded in its last session $1.2071.

In domestic transactions, the yuan last traded 6.8960 against the dollar. Bitcoin fell 0.7% to $18635.