The US dollar depreciated almost to a 2-year low on Monday as new expectations for the Brexit deal and fiscal stimulus in the United States as well as the progress of the Covid-19 vaccine prompted demand for risky currencies.
The pound has become the choice of market players after the UK and European Union agreed on Sunday to resume Brexit negotiations and EU chief negotiators said a deal could still be reached.
The pound sterling strengthened almost 1.5% against the US dollar at the $ 1.3423 exchange rate, soaring from Friday's low of $ 1.3135.
ING strategy analysts are of the opinion that although the Brexit negotiations are in the final phase, they believe that the agreement is still achievable and has a high probability.
Elsewhere, the United States began distributing Covid-19 vaccines to distribution centers on Sunday, raising hopes for a faster economic recovery. In addition, the market is also optimistic about the fiscal stimulus package deal in Washington.
The $ 908 billion Covid-19 installation assistance plan will be divided into two parts in the hope of reaching an agreement. The US dollar index, which measures the greenback against major currencies, fell 0.57% at the 90.403 exchange rate as of 10.00 p.m.
The Euro strengthened against the US dollar by 0.44% at the exchange rate of 1.2165. Restrictions implemented to curb the spread of Covid-19 in Europe are reported to have a limited impact on the market.
Market focus is now focused on the U.S. stimulus package and Brexit developments between the EU and Britain.
