US dollar slides, posts worst weekly run of losses in a decade

New York

THE dollar dropped on Friday, falling for eight straight weeks, as investors looked to other currencies whose economies are currently outperforming that of the United States in terms of managing the Covid-19 pandemic.

The delay in the passage of additional US stimulus for virus relief did not help the dollar's cause as well.

The dollar's eight consecutive weeks of losses represent its longest weekly run of declines in a decade, Refinitiv data showed, with Friday's decent batch of US economic data failing to lift the greenback. "Because of higher coronavirus case counts in the US, you have the prospect of longer restrictions," said Ranko Berich, head of market analysis, at Monex Europe in London. "You have the prospect of longer-lasting drags to human behaviour and that means slower recovery in the US than other developed economies." Hopes for additional stimulus to combat the pandemic faded on Friday, with the Senate and House of Representatives in recess and no fresh talks scheduled with US President Donald Trump's negotiators.

Mr Trump, however, announced on Friday the White House is preparing to provide relief for the economic pain caused by the virus as legislation stalls in Congress, saying his administration is ramping up to send money to families, state and local governments, and businesses. Markets reacted little to his announcement.

The dollar was unmoved after data showing a 1.2 per cent rise in the US retail sales' headline number in July, which was lower than expected, but a higher than forecast gain of 1.9 per cent, excluding vehicles.

Against other currencies, the dollar had its best weekly percentage gain versus the yen in two months. It was last down 0.3 per cent at 106.60 yen.

The euro, meanwhile, continued its rise, up 0.2 per cent at US$1.1835, rising for eight straight weeks.

The biggest loser for the week has been the New Zealand dollar, which was down 0.8 per cent against the dollar this week, its worst weekly fall since mid-June. The Reserve Bank of New Zealand flagged increased bond buying and again mentioned the prospect of negative rates. REUTERS