Correction on the US Dollar Is Observed

August 3, 2020

The US dollar has become stable against a basket of currency majors. The US dollar index (#DX) closed in the green zone (+0.34%) on Friday. However, it seems to be a technical correction due to a recent prolonged decline. The overall trend is still weak as investors are concerned about a slowdown in the US economic recovery due to the COVID-19 pandemic. According to White House coronavirus experts, the United States has already reported more than 4.6 million cases of coronavirus, and now there is a new outbreak: the virus is spreading both in rural areas and in cities.

The US Congress could not decide anything about the next round of economic assistance measures amid the pandemic. The worst economic crisis since the Great Depression has started in the country. Last week, several million US residents lost $600 in weekly unemployment benefits after the White House and Congress were unable to resolve the issue of payments extending. Congress offers to extend weekly payments until next year, but Republicans believe that because of such large sums, people do not want to look for any work and stay at home. They offer to pay $200 until each state creates a system that provides 70 percent compensation for laid-off workers.

Today, during the Asian trading session, quite optimistic economic data have been published in China. So, Caixin manufacturing PMI counted to 52.8 in July instead of 51.3.

The “black gold” prices are declining after the growth on Friday. At the moment, futures for the WTI crude oil are testing the $39.85 mark per barrel.

Market indicators

On Friday, there was the bullish sentiment in the US stock market: #SPY (+0.79%), #DIA (+0.41%), #QQQ (+1.78%).

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