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Dollar Decreases After California Says Stay at Home

The U.S. dollar could register the maximum weekly gain since the Great Depression of 2008 due to the investors shift into cash amid the infection pandemic concerns.

dollar index declinesPhoto: Pixabay

The dollar index, measuring the value of the greenback to a basket of its 6 main rivals sank by 1.10 percent, to 96.00 at 0945 GMT on Friday, bouncing back from an over 3-year high of 103, marked on Thursday, amid mounting fears about the economic impact of the Covid-19 in the U.S. economy after California said near 40M people to remain at home in an attempt to contain the spread of the virus. 

Investors, meantime worry that other U.S. states will follow California’s decision. On the week however, the dollar was on way to show its strongest gain since 2008, as stock market crush and business shutdowns propelled demand for liquidity and funding.

The Antipodean currencies soared on Friday, with the Aussie jumping by 2.81 percent, to 0.5914 and the Kiwi dollar surging by 2.35 percent, to 0.5817 at 0953 GMT. 

The UK’s pound also grew significantly by 2.18 percent versus the buck, to 1.1747, as well as Japanese currency, which grew to dollar by 1.0 percent on Friday.

Despite the actions of central banks around the world, viral fears remain in the markets, so the dollar rally is likely to continue.

Source: Reuters

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  • avatar-2954
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    On way for a downturn? It seems like a guaranteed recession and potentially doldrums if they keep it up

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