US Dollar weakens as euro gains on Franco-German proposal of €500 billion relief fund

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US Dollar weakens as euro gains on Franco-German proposal of €500 billion relief fund

On Tuesday, the 19th of May 2020, the US Dollar fell against a basket of major currencies but safe-haven Japanese Yen, as the bloc’s common currency extended its Monday’s (May 19th) gain following reveal of a media headline that the bloc’s first- and second-largest economy, Germany and France respectively, had been pushing for relief bills for the EU regions and firms that had borne the heaviest brunt in the pandemic outbreak.

Aside from that, inspiring results from a potential vaccine trial for the global-scale pandemic outbreak appears to be reducing safe-haven demands with the American currency having sprung up to a roughly one-month peak against its Japanese counterpart.

If truth is to be told, Tuesday’s tottering of the US Dollar was almost entirely prompted by a revival of bids for the riskier assets, while a Franco-German proposal to EU parliament to borrow a stark upsum of €500 billion on behalf of the whole EU, had spurred up investors’ optimism.

Meanwhile, suggesting the Franco-German proposal had been the first leap forward towards economic recoveries in a post-pandemic eurozone, a currency analyst at MUFG, Lee Hardman said on Tuesday (May 19th), “The Franco-German proposal represents a material step forward towards harnessing joint fiscal capacity to provide sustained fiscal stimulus to support the economic recovery.

” Citing statistics, while this report was being prepared, May 19th, GMT. 16.00, the US Dollar index (DXY) measured against a basket of six major currency was down by 0.16 per cent to 99.46, while the American currency gained 0.53 per cent against its Japanese peer to 107.88, hitting a nearly one-month peak as beforementioned.

In tandem, the US currency shed 0.73 per cent to $0.6563 against the Chinese export oriented Australian Dollar following a revival of Chinese economy, whose industrial activity gains 3.9 per cent in April on a year-on-year basis, while the New Zealand Dollar rose by 1.11 per cent to $0.6100.

Besides, while another safe-have Swiss Franc was treading water to $0.9719 against the US Dollar, the Pound sterling alongside the bloc’s single currency rose by 0.19 and 0.48 per cent respectively to $1.0935 and $1.2255 against their American counterpart.