Worries about rising infection numbers and risks to the fragile global economic recovery made global markets cautious.
Widening COVID-19 restrictions also weighed on market sentiment. Investors pulled back as a host of countries announced record infection rates and tougher lockdowns.
The U.S. death toll from COVID-19 passed 250,000 on Wednesday. New York City’s public-school system, the country’s largest, called a halt to in-classroom instruction.
Fiscal stimulus plans are falling by the wayside as President Donald Trump’s refusal to concede electoral defeat consumes lawmakers’ attention. Speculation is growing that the Federal Reserve may further loosen monetary policy in December. Two Fed officials on Wednesday held out the option of doing more.
Now all eyes are on the U.S. Federal Reserve for signs it could step in with fresh monetary stimulus.
The Times reported that European leaders will urge the European Commission to publish no-deal Brexit plans.
A stalemate over a post-Brexit trade deal with the EU sparked fears of more damage to an already faltering domestic economic recovery.
START TRADINGForex – Global markets cautious as infection numbers rise
At 1000 GMT ECB President Christine Lagarde appears at a European Parliament Committee hearing in Frankfurt. Also, investors await U.S. jobs data at 1330 GMT.
The dollar was caught between two opposing forces. A safety bid supported it. But renewed speculation over monetary easing to boost the economy held it back somewhat.
Further, EURUSD shed 0.2% to last trade at $1.1827.
The Canadian dollar weakened against its U.S. counterpart on Thursday, pulling back from a one-week high the day before.
The dollar index was up 0.1% at 92.59, though close to the weakest it has been since August.
Safe-haven Japanese yen fell 0.2% against the greenback to 104.10. The Japanese currency has gained 1.6% in the week since Pfizer announced promising trial results on its COVID-19 vaccine.
The Australian dollar – beneficiary of the dollar’s recent decline – lost strength, falling 0.4% at 0.7276.
Sterling dipped 0.4% to $1.3210 and 0.2% at 89.53 pence against the euro. pound traders waited for hints about the likelihood of the UK and European Union reaching a post-Brexit trade deal before the Dec. 31 deadline.
Oil prices also fell 0.4% to 0.9% as virus restrictions crimped demand expectations.
Gold traders continued to take a longer-term view, betting the COVID-19 vaccines would translate into a quicker economic recovery. That sent the precious metal to a one-week low.
PLEASE NOTE The information above is not investment advice.
Sources: Reuters, Investing, CNN money