- USD/JPY breaks below 105.00 support and reaches 104.35 low.
- USD drops nearly 1% to hit one-month lows.
- The dollar drops across the board amid hopes of a US stimulus deal.
The US dollar is feeling heavy against the Japanese yen on Wednesday. The pair has lost nearly 1% on the day, retreating from 105.50 area, to break support at 105.00 reaching to multi-week lows at 104.35.
Dollar plunges on US stimulus hopes
The US dollar has broken below the 105.00/106.00 horizontal trading range seen during the last two weeks as fresh hopes about the possibility of a fiscal stimulus agreement in the US have triggered a sell-off on US bonds that has undermined demand for the greenback.
News reports suggesting that the COVID-19 stimulus agreement might be closer have been welcomed by the market, that has reacted with a renewed appetite for risk. With the investors increasing bets for riskier assets, the safe-haven US dollar he’s dropped to seven-week lows against a basket of the most traded currencies.
The White House Spokesperson, Nancy Pelosi affirmed that she is optimistic about the chances of reaching an agreement before the Presidential elections and US President Trump has boosted hopes further earlier today affirming that he is willing to accept a large aid bill despite the opposition of Senate Republicans.
Technical levels to watch
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