FX.co ★ 03.12.2020: USD plumbing 2-year lows (DJIA, USDX, USD/CAD)

Futures on the US stock indices are trading marginally lower ahead of the publication of US macroeconomic data. The US dollar is extending weakness across the board, including the Canadian dollar. The market is alert to a series of PMIs from the US and data on unemployment claims.

Today futures on the US benchmark stock indices opened the New York trade with a moderate decline. However, later they picked up steam. The Dow Jones rose 0.06%, the Nasdaq edged up 0.01%, the S&P 500 grew 0.18%.

Meanwhile, investors await data on business activity in the US and weekly updates on unemployment claims.

The revised PMI for the US service sector is expected to fall to 56 points in November from 56.6 in October. In a separate report, analysts reckon that the number of initial unemployment claims decreased by 3,000 to 775,000 on the week ended November 28. The US Labor Department will release its updates later today.

Remarkably, optimism on global trading floors is cemented by the news on the vaccine front. The greenlight to the vaccine emergency use and the prospects of mass vaccination arouse hopes for a rapid economic recovery.

The US dollar was losing ground against the yen today. The greenback is trading flat against the euro amid hopes for economic stimulus in the US.

The US dollar index shed 0.43% to trade at 90.71. Importantly, the indicator sank below 91 points for the first time since late April 2018.

Investors are keeping close tabs on the situation with the stimulus bill. On Tuesday, US Senators submitted a draft of the stimulus package worth 908 billion dollars.

Extra financial aid approved before the inauguration of President-elect Joe Biden is expected to mitigate risks of slipping the US economy into recession. Besides, stimulus measures feed inflation expectations, thus weakening the US dollar in view of long-term aims of the Federal Reserve.

Optimism about COVID-19 vaccines is keeping investors in the elevated mood. On Wednesday, the UK approved the vaccines by Pfizer and BioNTech for the nationwide use.

The US dollar is skidding against its Canadian rival. The USD/CAD pair is 0.13% down today trading at 1.2906.

The US economic data provides fresh evidence of a downturn that could assure lawmakers of urgent stimulus measures. The ADP National Employment report and an industrial production survey from the Institute for Supply Management released yesterday were much weaker than expected. Sales of cars and trucks contracted from October. The US reported over 2,700 deaths from COVID-19 over the latest 24 hours. Thus, the death toll totaled 5,000 over the last two days. The number of patients admitted to hospitals per 24 hours also set a fresh record of more than 100,000.

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