Dollar Down, With Investors Curbing Vaccine Enthusiasm as Questions Remain

 

By Gina Lee

Investing.com – The dollar was down on Wednesday morning in Asia, with a new surge of U.S. COVID-19 cases and questions over how a COVID-19 vaccine will be delivered tempering optimism from earlier in the week that a vaccine would become available quickly.

The U.S. Dollar Index Futures that tracks the greenback against a basket of other currencies inched down 0.06% to 92.648 by 10:03 PM ET (2:03 AM GMT).

The dollar saw gains after Pfizer Inc (NYSE:PFE) and BioNTech (F:22UAy) released positive interim phase 3 results from their COVID-19 vaccine candidate BNT-162b2 on Monday, with the results suggesting that the vaccine was 90% effective in preventing infection.

Although the news saw the dollar gain against safe-harbor currencies such as the yen and the Swiss franc, and prompted a rise in global shares, concerns about logistical hurdles such as shipping the vaccine at extremely cold temperatures and other hurdles, such as the vaccine’s efficacy and longevity, curbed investors’ enthusiasm.

However, some investors remained cautiously optimistic over the dollar’s long-term prospects.

“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 … however, the dollar is supported by rising Treasury yields, which should help the dollar make another push higher before year’s end,” IG Securities senior foreign exchange strategist Junichi Ishikawa told Reuters.

A continuing second wave of COVID-19 cases in the U.S. saw some states impose restrictions with the advent of winter in the Northern Hemisphere bringing colder weather and worries over soaring hospitalizations. Of the over 51 million global cases recorded as of Nov. 11, over 10.2 million cases are U.S. cases, according to data from Johns Hopkins University.

The USD/JPY pair edged down 0.18% to 105.09.

The AUD/USD pair inched up 0.06% to 0.7288. Across the Tasman Sea, the NZD/USD pair was up 0.51% to 0.6863. The Reserve Bank of New Zealand left its interest rate unchanged at 0.25%, conforming to expectations as it met earlier in the day. Investors’ focus had been on whether the central bank would adopt negative rates.

The USD/CNY pair was down 0.24% to 6.5990.

The GBP/USD pair inched down 0.05% to 1.3264. The pound had hovered near a two-month high over hopes that the U.K. and the European Union will soon reach consensus on their long-awaited Brexit trade deal. The two sides continue talks that began on Monday in London.

source : https://www.investing.com/news/forex-news/dollar-down-with-investors-curbing-vaccine-enthusiasm-as-questions-remain-2345460