In the second last session of the year, the euro improved against the US dollar by 0.25 percent on Wednesday, December 30, trading at 1.2253. At 89.63, the DXY dollar index dropped 0.42 percent.
The main news concerning the U.S. currency remains the introduction of a fiscal relief program. The House of Representatives accepted a raise in the volume of compensation from $600 to $2000 per person earlier this week. However, Republican majority leader Mitch McConnell blocked a raise in the volume of payments on Tuesday, as the bill was debated in the Senate, insisting that President Donald Trump’s conditions on the accountability of social networks for the quality of publications and the distribution of funds to verify the evidence of electoral fraud be included in the bill.
According to the Democratic minority leader in the Senate, Ch. Schumer, the House of Representatives will not pass such a bill and, accordingly, will not be allowed to become law. Thus, the problem of rising lump-sum transfers is still “suspended” but in the very distant future, according to the head of the US Treasury, payments under the assistance plan negotiated by Trump for almost $900 billion will continue to flood through American bank accounts.
The U.S. dollar has fallen dramatically against nearly all foreign currencies since President Donald Trump signed the 2021 budget and economic stimulus plan worth $ 2.3 trillion on Sunday, as the possibility of further stimulus for the U.S. economy has decreased demand for protective assets.
On some aspects of the U.S. relief plan, the last-minute standoff has cast doubt, but several experts say that the U.S. government will be pressured to improve the economy one way or another when the nation continues to see a significant number of cases of coronavirus that endanger the economic recovery.
About the fact that the volume of preferential compensation is not yet known, many observers claim that next year the dollar is likely to begin to slide, as Joe Biden is expected to press for even further economic stimulus initiatives. Another factor in the fall of the dollar is the hopes of investors that the Fed would hold interest rates down for an incredibly long period.