Caution grew over a global surge in coronavirus cases and fading prospects for a U.S. stimulus package making markets jittery and nervous.
Hopes for a new round of U.S. fiscal stimulus met fears that social restrictions would undermine economic recovery.
Fresh restrictions to combat COVID-19 have been introduced across Europe. The U.S. Midwest is battling spikes in new cases as data show the country’s economic recovery is losing steam.
U.S. President Donald Trump’s offered on Thursday to increase the size of a fiscal stimulus package to win the support of Republicans and Democrats. However, many investors still believe a deal is unlikely before the Nov. 3 election.
Investors will get a further indicator of the health of the U.S. economy with retail sales data due later on Friday. Relief plans remain bogged down in a three-way negotiation between the White House, Senate Republicans and House Democrats.
Uncertainty regarding the trade negotiations between the European Union and the UK remained high. British Prime Minister Boris Johnson was expected to respond to the EU’s demand for more concessions.
START TRADINGForex – Markets jittery on US stimulus talks impasse
Financial markets remained shaky on Friday.
The dollar remained on track Friday for its biggest weekly gain in a month. The US currency headed for weekly gains on investor appetite for safe-haven assets of 0.7%. The greenback was last down 0.1%. On a monthly basis, the dollar index is up 0.7%, its biggest rise since end-September.
The Japanese yen headed for weekly gains on investor appetite for safe haven assets of 0.3%.
The euro regained some ground, rising about 0.1% to $1.1717. Investors shifted from perceived safe havens such as the dollar and the yen to riskier currencies.
The Japanese yen was steady at 105.23 to the dollar.
Canadian dollar pares weekly decline as vaccine hopes rise. The loonie edged higher against its U.S. counterpart on Friday, recouping some of this week’s decline. Investors cheered prospects for a COVID-19 vaccine.
The Canadian dollar was trading 0.1% higher at 1.3206 to the greenback. For the week, the loonie was on track to end 0.7% lower.
Elsewhere, Sterling yo-yoed again amid fractious Brexit negotiations between the UK and European Union. The pound gained as much as 0.5% in early trading on hopes a trade deal was possible. It then turned negative after UK Prime Minister Boris Johnson said it was time to prepare for no deal. The pound was last down around 0.2%.
Oil prices continued to slide, dragged down by concerns that resurgent COVID-19 cases would curtail demand.
Brent crude futures for December dropped 0.5% to $42.93 a barrel. U.S. (WTI) crude futures for November delivery dipped 0.4%, to $40.81 a barrel.
Spot gold prices were flat at $1,909.05 but looked set for their first weekly drop in three.
PLEASE NOTE The information above is not investment advice.Sources: Reuters, Investing, CNN money