The dollar index, which tracks the greenback’s value against a basket of currencies, touched its lowest level in over two years.
What’s going on: Investor sentiment soared this month — following Biden’s win and prospects of congressional gridlock, possible stimulus, and headway on coronavirus vaccines.
Investors shifted into riskier assets — leaving the dollar to fall 2.5% this month.
The New Zealand dollar, on the other hand, is on track for its biggest monthly gain in seven years.
What they’re saying: The worsening pandemic and uncertainty over OPEC+ moves shouldn’t cloud the “generally positive risk environment, which has seen around $36 billion worth of portfolio flows returning to emerging markets over the last month — largely at the expense of the dollar,” ING strategists wrote.
“While more lockdown restrictions may stand to curb U.S. equity markets, the prospect of the Fed being prepared to add more liquidity should limit any dollar upside.”