US dollar is steady, but analysts see bull case
The discovery of the coronavirus vaccine is among the biggest catalyst for the greenback as it would help in stabilizing the US economy. Pfizer has announced that they are in a position to supply more than 1.3 billion doses in 2021. Several other companies are also close to their phase 3 trials of coronavirus vaccine.
US dollar is likely to rally in analysts view
US dollar rally will accelerate once the government finds the way of delivering the vaccine because scientists say the vaccine needs to be stored in arctic-like cold temperatures.
The sharp growth in virus infections in the US has also raised investors’ concerns over economic recovery.
The US has reported almost 10 million coronavirus infections on Monday of global 51 million infections. The situation is likely to worsen because of large gatherings during elections.
“The dollar recovery is on hold for now because, when you look at the details, there are still a lot of hurdles to clear before any vaccine is rolled out,” said Junichi Ishikawa, senior foreign exchange strategist at IG Securities in Tokyo.
“However, the dollar is supported by rising Treasury yields, which should help the dollar make another push higher before year’s end.”
Risker currencies are pulling back
US dollar experienced massive losses after Joe Biden has beaten Donald Trump in electoral votes, but vaccine hopes have provided some support to the greenback.
Chinese Yen, which jumped to 28 months high against the greenback, fell 0.14% against the US dollar.
Euro and the British Pound also retreated against the US dollar. The USD index, which tracks the US dollar against the basket of six currencies, is currently trading around 92.69 level after hitting ten weeks low of 92.20 on Monday.