(Alliance News) - The US dollar started the new week on the front foot as risk sentiment took a step back.
"The USD is stronger for a fourth, consecutive session, a feat it has not achieved since late October. Recent drivers of USD softness - rising commodities, stronger stocks and lower yields are moderating at least but whether we see a wholesale reversal in these trends remains to be seen," said Scotiabank.
Scotiabank added: "While the USD may catch a bid on position-adjustment or profit-taking after its recent weakness, a sustained recovery will have to be accompanied by either a clear improvement in recent yield trends or a positive US growth shock. It is hard to envisage a case for either at the moment."
The buck climbed even as the aftermath of last week's riot in Washington, which saw Trump supporters storm the Capitol, continued to be felt.
The US House of Representatives will proceed Monday with steps to impeach President Donald Trump, Speaker Nancy Pelosi confirmed Sunday in a letter to Democratic lawmakers.
On Monday morning, Pelosi wrote, a resolution is to be tabled calling on Vice President Mike Pence "to convene and mobilize the Cabinet to activate the 25th Amendment to declare the President incapable of executing the duties of his office."
"In protecting our Constitution and our Democracy, we will act with urgency, because this President represents an imminent threat to both," she asserted.
Versus the Canadian loonie, the US dollar was priced at CAD1.2824, rising from CAD1.2681 on Friday afternoon. Against the Australian dollar, the greenback rallied to AUD1.3007 versus AUD1.2836.
The pound and euro weakened on Monday amid a dire virus situation in Europe.
More than 1.9 million people worldwide have now died from the virus, with new variants adding to soaring cases and prompting the re-introduction of restrictions on movement across the globe – even as with mass inoculation drives underway.
Germany's topped 40,000 fatalities on Sunday, the centre for disease control announced. In her weekly video message, Chancellor Merkel had warned Saturday that the full impact of socialising over the Christmas and New Year's period had yet to be felt.
The euro was changing hands at USD1.2157 on Monday afternoon in London, dipping from USD1.2267 on Friday afternoon.
In the UK, senior ministers have discussed the prospect of introducing tighter lockdown controls in an effort to improve compliance with the current rules, according to media reports.
The prime minister reportedly spoke with senior ministers on Sunday to evaluate "whether the current lockdown rules were working" in reducing the spike of coronavirus cases, the Daily Telegraph suggested. The newspaper said the government was considering scrapping the exemption allowing people to exercise with one other person from outside of their household or support bubble.
Some experts have branded the current lockdown measures not strict enough, in the face of the more transmissible variant which has spread rapidly in many parts of the country.
The pound was trading at USD1.3483 on Monday afternoon, sinking from USD1.3611 on Friday afternoon. Against the euro, sterling slipped to EUR1.1091 from EUR1.1100 at the same time on Friday.
Against the safe haven Japanese yen, the dollar was trading at JPY104.22 Monday afternoon in London, higher than JPY103.72 on Friday. Versus the Swiss franc, the buck was quoted at CHF0.8906, up from CHF0.8835.
By Lucy Heming; lucyheming@alliancenews.com
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