TOKYO- The US dollar held onto gains against major currencies on Wednesday, supported by positive US economic data and concerns about a second wave of coronavirus infections in Europe and Britain.
The Australian dollar hit a six-week low on growing expectations the Reserve Bank of Australia (RBA) may cut interest rates next month.
The New Zealand dollar edged lower in choppy trade after the country’s central bank kept monetary policy unchanged and reaffirmed its commitment to asset purchases.
The greenback is likely to continue to grind higher in the short term as the coronavirus rattles sentiment in Europe, but uncertainty about this year’s US presidential election means the dollar could be prone to more volatile swings.
“Some people are betting for more dollar strength against the euro, which looks overvalued,” said Masafumi Yamamoto, chief currency strategist at Mizuho Securities in Tokyo.
“The picture in Europe has completely changed, because the economic recovery is stalling and there is a second wave of the virus, but I’m also worried about US politics.”
The dollar edged up to $1.1683 per euro on Wednesday in Asia, close to a two-month low hit in the previous trading session.