NEW YORK: The dollar bounced off an almost three-month low against a basket of currencies hit on Monday following optimism over another Covid-19 vaccine as the index approached a technical support level that if broken, could signal further weakness for the greenback.
The dollar had weakened as risk appetite got a boost after AstraZeneca said that its vaccine could be about 90% effective and it would prepare to submit data to authorities around the world that have a framework for conditional or early approval.
The dollar index was last up 0.05% at 92.366, after earlier dropping to 92.013, the lowest since Sept. 1. It is hovering just above technical support around 92, a conclusive break below which could usher in new weakness, analysts said.
The Reuters dollar index showed the greenback falling to a more than two-year low of 91.737 on Sept. 1. It fell to 88.251 in February 2018, which was the lowest since December 2014.
The euro was last down 0.01% at $1.1855. Based on the dollar index, the next target for the euro is likely its September high near $1.2010, followed by the February 2018 high of $1.2555, Brown Brothers Harriman said.
The New Zealand dollar surged to a two-year high after strong retail sales data, before falling back to be little changed on the day at 0.6930 per dollar. The pound was boosted by hopes for a Brexit deal. The EU's chief Brexit negotiator said that fundamental divergences remain but both sides were pushing hard for a deal. Sterling was last 0.44% up at $1.3349.
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