Dollar Rises After Suspension of Some Emergency Program

The dollar rose today, Friday, against a basket of currencies in early trade in London, reversing its downward trend when US Treasury Secretary Stephen Mnuchin called for an end to some emergency lending by the Federal Reserve (US Central Bank).

Mnuchin’s move reallocates about $ 455 billion directed to the Treasury to other means of spending, but some investors are anxious about ending programs they believe play a vital role in reassuring markets.

And US 10-year Treasury yields fell to their lowest levels since Nov. 9.

The Reserve Board also said it ” The Federal Reserve would prefer that the full suite of emergency facilities established during the coronavirus pandemic continue to serve their important role as a backstop for our still-strained and vulnerable economy. ” in a rare open confrontation with the government.

The announcement reduced optimism stemming from reports that senators from both the Republican and Democratic parties have agreed to resume talks on another stimulus package linked to the Coronavirus.

The dollar index recorded 92.335 before the opening of the European markets, to settle during the day after it fell during the night and then rose again with the opening of the European markets.

Analysts attributed the atmosphere of caution to the high cases of Coronavirus.

But the dollar is down about 0.5% for the week, as sentiment in the currency market is supported by US President-elect Joe Biden’s victory and progress towards developing a vaccine for Covid-19.

The Australian dollar, a measure of risk appetite, is recording the best monthly performance against the US dollar since April in terms of percentage change

The Japanese yen fell about 0.1% against the dollar, to 103.84.

The euro settled against the dollar at 1.18725, and is heading towards a limited weekly gain.

Bitcoin is approaching, but not exceeding, its highest level in three years, which is recorded on Wednesday at $ 18,483.