Picture used for illustrative purpose. File
The dollar ticked up in Europe on Wednesday, recovering some losses after a two-day fall, as traders weighed the implications of a bad-tempered first debate between President Donald Trump and his challenger, Joe Biden.
The dollar index crept just above the 94 mark against a basket of currencies after two days of losses that followed the US currency reaching a two-month high last week.
The euro was down 0.3% against the dollar at $1.1706.
Overall the dollar was set for its worst quarter since the spring of 2017 with a fall of about 3.3% as hopes for a swift recovery from the COVID-19 economic crash made investors exit safe havens and buy into riskier currencies.
Market action following the debate however showed some nervousness as uncertainty over the outcome of the US presidential election remains high after a chaotic encounter in which the candidates battled over the president's leadership on the coronavirus pandemic, the economy and taxes.
US stocks futures and European stocks traded lower hours after the debate which, according to political betting odds, gave the Democratic challenger a slight edge over the incumbent.
"The way the market narrative is playing at the moment is toward a Biden victory being somewhat negative for the dollar, because of fiscal expansion taking place when the Fed is on hold and can tolerate higher inflation," said Stuart Ritson a portfolio manager at Aviva Investors.
Many market participants were cautious about linking currency moves to the debate.
"I don't think that the USD recovery is related to the TV debate, which has, if anything, increased US political risks and should weigh on the USD," said Thu Lan Nguyen, a foreign exchange strategist at Commerzbank.
"Instead, we are seeing a natural pullback after the sharp depreciation in the last two days, which I think is natural", she said.
Traders also watched for progress in talks about further US fiscal stimulus to soften the coronavirus blow.
Economic indicators have recently painted an uneven picture of the economic recovery in Europe, but Wednesday's data were generally positive.
German retail sales rose more than expected in August, raising hopes that household spending will power a recovery in the third quarter.
European Central Bank President Christine Lagarde also grabbed investors' attention as she set the scene for aligning the ECB's strategy with that of the
Federal Reserve, possibly including a commitment to let inflation overshoot after it has been low for too long.
The dollar rose 0.28% against the Swiss franc at 0.9218 franc, after falling as low as 0.9191 franc overnight.
Switzerland's KOF leading indicator hit a 10-year high in September, rising for the fourth time in a row as the economy extended its recovery from the coronavirus.
China's yuan held steady even after twin surveys showed strong factory activity, backing recent signs of a rebound in broad sectors of the world's second-biggest economy.
The offshore yuan steadied at 6.8111 per dollar.
Against the yen, the dollar was stable at 105.64 yen, below a two-week high of 105.74 overnight.
Risk sentiment was also undermined after Federal Reserve officials expressed concern that rising coronavirus cases could harm economic growth just as stimulus measures start to expire.
The dollar index, which tracks the greenback's value against a basket of currencies, had climbed 1% above the two-year low at 92.12 hit on Tuesday, and was consolidating gains at 92.90 in early London trading.
Against a basket of currencies, the dollar traded under gentle pressure at 92.987, roughly in the middle of the range it has held since dropping to a two-year low in late July.
Global equities wavered and the dollar fell to two-year lows on Tuesday as the broad US stock market briefly scaled new peaks on better-than-expected corporate earnings but soon retreated on an economic outlook burdened by the coronavirus pandemic.
During COP28 in Dubai on Tuesday, global green energy giants Iberdrola and Masdar announced a €15 billion strategic partnership agreement to evaluate the joint development of offshore wind and green hydrogen projects in key markets including Germany, UK and the USA.
The 44th edition of Big 5 Global, the largest and most influential construction industry event in the Middle East Africa and South Asia opened in Dubai World Trade Centre. The event boasts a stronger and more impactful local and international support, with over 2,200 exhibitors from 60+ countries
Sustainable Trade Africa (STA) takes pride in successfully concluding its pivotal event, contributing significantly to the discourse on sustainable development within the African trade landscape during COP28. Under the theme “Transforming Africa Trade for Climate Resilience & Sustainable
The Riyad Bank Saudi Arabia Purchasing Managers’ Index (PMI) continued to signal a rapid expansion in the non-oil private sector in November, despite evidence that price pressures accelerated to their highest in nearly one-and-a-half years. Reports of increased raw material prices fuelled a renewed uplift