Dollar Down After Investors Welcome Loosened Lockdown Plans
The dollar was down on Monday morning in Asia, giving up some of its gains from earlier in the session.
The gains came after some countries’ plans to lift lockdowns curbing the spread of the COVID-19 pandemic boosted investor sentiment. California, Michigan, and Ohio, three of the important states for U.S. manufacturing, took steps to allow factories and some businesses to resume work.
The U.S. Dollar Index that tracks the greenback against a basket of other currencies slipped 0.04% to 99.725.
The number of U.S. unemployment claims since late March soared above 30 million on Thursday, and Treasury Secretary Steve Mnuchin warned overnight that the U.S. unemployment rate could already have reached 25%.
“The bad news about the U.S. labor market was pretty much as expected, and people now assume that economic activity will restart sooner rather than later in the United States and Europe,” Tohru Sasaki, head of Japan markets research at J.P. Morgan Securities, told Sources.
“We don’t have to be so bearish on the dollar.”
The USD/JPY pair gained 0.16 % to 106.82 after Japan announced a second budget to ease COVID-19’s economic impact, including aid for companies struggling to pay rent and more subsidies for those hit by slowing sales.
The country also plans to remove 34 prefectures that reported no new cases from the state of emergency designation on May 14.
The AUD/USD pair gained 0.38% to 0.6553 while the NZD/USD pair was up 0.15% to 0.6142.
The USD/CNY pair gained 0.07% to 7.0781.
The GBP/USD pair was up 0.15% to 1.2426 after Prime Minister Boris Johnson outlined the U.K.’s plans to slow lift COVID-19 lockdown measures on Sunday.