Dollar Value Plummets to Lowest Level Since 2018

Dollar Index Falls Below 90
Impact of Possible US Stimulus Bill Agreement and Continued Fed Asset Purchases
Gold Price Recovers to $1900

[Image source=Reuters Yonhap News]

[Asia Economy New York=Correspondent Baek Jong-min] The value of the US dollar has fallen to its lowest level since 2018.

On the 17th (local time), the Dollar Index, which shows the value of the dollar against major currencies, was recorded at 89.72. The Dollar Index fell about 0.71% compared to the previous day, dropping below the support level of 90.

This is the first time the Dollar Index has fallen below 90 since April 2018. The Dollar Index surged to 103 in March due to a shortage of dollar liquidity caused by the COVID-19 pandemic but has since turned downward.

The decline in the dollar's value is interpreted as being influenced by reports that the US Congress is expected to agree on a $900 billion stimulus bill.

One day earlier, the US Federal Reserve (Fed) provided guidelines indicating that it would continue its $120 billion monthly asset purchase program for a considerable period, which is also seen as having fueled the decline in the dollar's value.

Contrary to the dollar's decline, gold prices soared. On this day, gold futures for February delivery on the New York Mercantile Exchange rose 2.2% ($41.40) to $1,900.50 per ounce.

This is the first time gold prices have recovered to the $1,900 level since November 6.

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