The US dollar depreciated almost to a 3-month low on Friday and recorded weekly losses against other major currencies. Market sentiment is still influenced by expectations of vaccine progress and anticipating a global economic recovery.
The US dollar depreciated more than 2.2% this month as global market sentiment rose following Joe Biden's victory in the US election, the announcement of the effectiveness of the Covid-19 vaccine and the rise in commodity prices. Reports like this have reduced market demand for safe haven currencies.
The announcement of the effectiveness of the vaccine has succeeded in boosting investor confidence although the Covid-19 pandemic positive case continues to rise.
Analysts are of the view that the US dollar tends to depreciate further on Friday in the absence of data that could be a catalyst. Furthermore the market is still on holiday following the Thanksgiving celebration.
The most feared risk in the current financial markets is the failure of the vaccine to be distributed in the first quarter of 2021. Another major risk followed is the surge in cases of Covid-19 infection.
President Donald Trump told Thursday he would leave the White House if the House of Representatives confirms Joe Biden's victory in the recent election.
His statement has to some extent added extra relief to the market, although Trump has repeatedly claimed fraud in the election.
The greenback dollar traded stable at 91,828 against a basket of major currencies.
