Breaking News
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Forex - Dollar Gains on Covid-19 Fears

ForexJun 25, 2020 02:59AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters.

By Peter Nurse - The dollar has come back into favor in early European trade Thursday, with concerns about the mounting coronavirus cases and the impact on the economic recovery prompting a return to the safe haven.

At 3 AM ET (0700 GMT), the dollar index, which tracks the greenback against a basket of six other currencies, was up 0.2% at 97.293.

EUR/USD fell 0.1% to 1.1239, GBP/USD dropped 0.1% to 1.2410, while USD/JPY was up 0.1% at 107.15. 

Signs of a sharp uptick in the number of Covid-19 cases in many U.S. states have resulted in traders seeking the reassurance of the greenback amid concerns a second wave of infections could trigger fresh lockdown measures.

The states of New York, New Jersey, and Connecticut have already decided that visitors from states with high rates of infections will have to self-isolate for 14 days.

“It will now be crucial to keep an eye on the rising number of hospitalizations as this will likely determine whether new extensive lockdowns will have to be put in place and/or reopenings stalled further,” said analysts at Danske Bank, in a research note.

Eyes will also focus on the weekly unemployment numbers, at 8:30 AM ET (1230 GMT). Initial jobless claims for the week ending June 21 are expected to be 1.3 million, while continuing jobless claims are expected to fall to 19.9 million. These figures would represent progress, but unemployment is still at post World War II highs. 

Elsewhere, USD/CAD rose 0.1% to 1.3649, after Fitch downgraded Canada’s long-term foreign currency debt rating to AA+ from AAA, the first treble-A rated nation to lose this prestigious mark since the start of the Covid-19 outbreak.

The rating agency cited a bigger general government deficit this year, with Canada set to emerge from the recession with much higher public debt ratios given the spending needed to counteract a sharp fall in output in the wake of the virus.

Turkey’s central bank is scheduled to announce its latest interest rate decision later Thursday, and is widely expected to cut its one-week repo rate once more, to 8.0% from 8.25%.

Turkey’s key interest rate was at 24% almost a year ago following a currency crash, and the central bank has authorised nine straight rate decreases since.

USD/TRY traded at 6.8587, up 0.1%, some way off the all-time high of 7.27 reached in early May.

The Bank of Mexico is also expected to cut its key rate by another 50 basis points at its policy meeting later in the day.


Forex - Dollar Gains on Covid-19 Fears

Related Articles

Dollar dips after Fed rally, Bitcoin slumps
Dollar dips after Fed rally, Bitcoin slumps By Reuters - Jun 21, 2021 4

By Karen Brettell NEW YORK (Reuters) - The dollar retreated from two-month highs on Monday as investors continued to evaluate whether a perceived hawkish tilt by the Federal...

Dollar Firm as Powell's Testimony to Congress Looms
Dollar Firm as Powell's Testimony to Congress Looms By - Jun 21, 2021

By Peter Nurse - The dollar edged higher in early European trade Monday, keeping the positive tone generated last week by the Federal Reserve's hawkish turn, which...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email