The Dollar Holding Its Gains on Recovery Hopes

The dollar rose to a two-month high against the euro on Tuesday as markets believed the United States’ recovery from the coronavirus pandemic would likely be faster than Europe.

This view was reinforced by moves in Washington towards more stimulus spending, in contrast to European closures and expectations of a decline in the eurozone’s GDP in Q1.

The euro fell 0.2% against the US currency to $1.2034, returning to the low it hit in early December, and down 1.61 from its level at the beginning of the year.

The dollar index, which measures the value of the US currency against a basket of six major currencies, rose 0.131% to 91.019 as stock indices rose in the United States and Europe and oil prices rose 2% to their highest levels in a year.

Against the Japanese currency, the dollar hovered around 105 yen, after crossing that level in Monday’s session for the first time since mid-November.

Many dealers consider that the dollar’s ​​recovery since early last month is a correction after a sharp decline in which the green currency lost about 7% of its value in 2020 due to expectations of a global recovery from the pandemic.