The US dollar depreciated as Democrats were seen as the top choice to win both Senate elections in Georgia, after much of the vote count was done showing the party's favor.
Against most major currencies, the greenback dollar fell to its latest low since April 2018 at 89.18 at the beginning of the European session.
However, with the rise in the outlook for fiscal stimulus, this has prompted investors to stay away from bonds and cause a 10-year US treasury yield spike to rise above 1% and this strengthening slightly supports the US dollar from falling lower.
Analysts generally consider the Democratic-dominated Senate to be positive for global economic growth as more fiscal stimulus is expected to be implemented by the Joe Biden administration.
The depreciation of the US dollar has pushed the euro to rise higher by recording its latest high of 2 and a half years. Investors' attention is now also focused on the publication of the minutes report of the FOMC and European Central Bank (ECB) meeting on Thursday.
Meanwhile, the pound also gained strength following the weakness of the greenback dollar despite pressure from the UK's economic shutdown to curb the spread of the Covid-19 infection. The UK recorded more than 60,000 cases on Tuesday, for the first time since the pandemic began.
On the other hand, the Aussie and New Zealand dollars also benefited from positive sentiment to rise to the latest highs since April 2018 against the US dollar.
The Canadian dollar continued to strengthen after being supported by rising world oil prices following a shock by Saudi Arabia as well as being helped by current sentiment.
