The greenback dollar continued to trade weakly on Wednesday in the Asian session as developments on the coronavirus vaccine and lack of uncertainty in U.S. politics led to an increase in the US stock market.
This is evident from the surge in the Dow Jones stock index, which broke through the 30,000 mark for the first time in history when it closed in the previous session, as well as the largest monthly increase since 1987.
The depreciation of the US dollar is likely to continue as market expectations for vaccines and declining political uncertainty and expectations of the election of former Federal Reserve (Fed) chairman Janet Yellen as new treasury secretary have eased huge uncertainty for investors.
The dollar index, which measures the strength of the greenback dollar against a basket of major currencies, traded lower at 92.10.
The Aussie dollar moved higher at a two-month high, while the New Zealand dollar strengthened at a two-year high against the USD. Both are considered a barometer of risk sentiment due to the highly dependent economy on global commodity trading.
The euro continued to strengthen its momentum after successfully breaking the 1.1900 price level against the USD, rising to a two-week high.
Meanwhile, the pound sterling continued to trade at a two-month high, supported by Brexit expectations although no new developments were reported on the talks.
Current sentiment also supports the trading of the Canadian dollar to trade at a two-week high against the USD as well as supported by the strengthening of crude oil prices.
