US Dollar Stabilizes on Vaccine And The US Doubts

The dollar stabilized against most currencies on Tuesday, November 17th, as the return of restrictions in some US states and concerns about a smooth transfer of power to President-elect Joe Biden dispelled optimism about a coronavirus vaccine.

Meanwhile, the British pound rose thanks to media reports that Britain might reach a post-secession trade agreement with the European Union by early next week.

The drug manufacturer Moderna became the second American pharmaceutical company in a week to announce positive results for trials of a vaccine for Covid-19, which is considered necessary to eradicate the pandemic.

Last week, encouraging progress in testing another vaccine contributed to the dollar’s rise against the safe-haven yen and the Swiss franc.

But the reaction in the currency market to subsequent developments has been weak, as the United States faces difficulties to contain the second wave of infections, while the vaccine is not expected to be distributed soon.

There is also some ambiguity surrounding Biden’s plans to confront the Coronavirus and stimulate the economy, while President Donald Trump’s administration refuses to cooperate with Biden’s transition team.

The dollar scored 1.1857 against the euro, and is heading towards a decline for the fourth consecutive session. The sterling reached $ 1.3213 and rose to 89.71 pence per euro. The US currency settled at 104.50 yen.

Dollar investors are looking to release data on US retail sales and industrial production later today to gauge the strength of economic recovery.