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Dollar collapses as Biden inches closer to White House

Dollar collapses as Biden inches closer to White House

The US dollar witnessed a major deterioration in its levels due to the preliminary results of the US presidential elections that reflected the close win of Biden, which pushed other major currencies to record highs.

The dollar index, which measures the performance of the federal currency against a basket of six major currencies, recorded a decline during Friday's session for the fourth consecutive session, hitting its lowest level in 9 weeks, in light of the drop in demand for the dollar with the increasing chances of Democratic presidential candidate Joe Biden to reach the White House.

Biden’s approach to settling the presidential race caused a significant weakness in the dollar’s levels, due to his policy that would improve trade relations with a number of other countries, led by China, which pushed the currencies of other countries to rise at the expense of the dollar.

On the other hand, the fall in dollar levels affected major currencies, as the euro rose and reached its highest level in two weeks after recording a rise for the fourth consecutive day.

As for the Japanese yen, it recorded its highest levels in more than 7 months during today's session due to the deterioration of the dollar levels. The dollar against the Japanese yen recorded its lowest level at 103.20 after it opened the day's trading at the level of 103.37 and opened the week's trading at the level of 104.52.

Yesterday, the Federal Reserve announced its decision to hold interest rates to remain below 0.25%, matching market expectations, so the Fed would maintain its loose monetary policy and pledged once again to do everything in its power in the coming months to maintain the speed of the US economy's recovery, amid the outbreak of the coronavirus pandemic.

Fed Chairman Jerome Powell said in a news conference after the bank meeting that the economy is still growing, but "I wouldn't say anyone feels comfortable about it." “We've had the first five or six months of expansion better than expected ... But we have to be humble as the pandemic continues.

The US election results are still being counted in a few major states, even though Biden is moving closer to reaching the White House.

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