Dollar rises on global economic concerns, US stimulus doubts

The US dollar rose on Monday, to head for its second gain in 3 days, as demand increased due to investors' risk-aversion after the sharp spike of coronavirus infections in Europe and the US, in addition to doubts about the US passing the new Covid-19 aid package before the presidential election next week.

The dollar index rose 0.3% to 93.07 points, after opening at 92.76, and hit an intraday low at 92.74.

The index lost 0.2% on Friday, after rising by 0.3% on Thursday, within recovery attempts from a 7-week low of 92.47 points.

The dollar index lost more than 1% during the past week and posted its third weekly loss in a month, and the largest weekly loss since July.

This came due to strong market sentiment, which propelled demand for high-risk currencies, after progress was made in the ongoing political talks about the US second fiscal stimulus package.

France reported a record rise of new Covid-19 cases on Sunday, which rose to over 50,000 cases per day, and Italy ordered restaurants and bars to be closed early, while the Spanish government declared a nationwide curfew.

The US reported on Friday that Covid cases rose more than 83,000 cases, the highest number so far since mid-July.

These developments are indicators of the second wave spread, which threatens any economic recovery that happened after the first wave.

US House of Representatives Speaker Nancy Pelosi said on Sunday that she will have some answers from the White House on Monday regarding a coronavirus stimulus deal.

These statements alongside few signs of progress in the political talks about the stimulus package indicate that the deal will not be launched before the US presidential election.