Dollar falls to 2-1/2 year low on stimulus bets

The US dollar rose on Monday to its lowest level in two and a half year, deepening its losses for the second straight day, on strong bets for the US Federal Reserve to inject extra monetary stimulus measures during its next meeting, to support the economy amid the worst economic crisis since the 1930s Great Depression.

The dollar index fell 0.2% to the lowest since April 2018 at 91.62 points, after opening at 91.78 points and hitting an intraday high of 91.78 points.

The index lost 0.2% on Friday, posting its third daily loss in 4 days due to improved risk appetite.

The index lost 0.6% during the past week, in its second straight weekly loss, due to weak demand.

The US Federal Reserve is widely expected to take further monetary stimulus measures to support the coronavirus-battered economy, which is currently suffering its worst economic crisis since the 1930s Great Depression.

The greenback's loss during November is 2.4% so far, which will be the first monthly loss in three months and the biggest loss since July.

This came due to a slowdown in demand for the US dollar as the best alternative investment, as the market sentiment strengthened.

The market sentiment improved thanks to positive news about Covid-19 vaccines, chief among these is AstraZeneca's promising vaccine.

While the political tensions eased in the US over the presidential election after a smooth transition of power from the current Republican President Donald Trump to President-elect Joe Biden began.