Forex – Dollar Index Extends Losses, Hits Fresh 3-Year Trough

© Reuters. Dollar loses more ground vs. rivals, hits fresh lows – The U.S. dollar extended losses to hit a fresh three-year trough against other major currencies on Wednesday, as the euro continued to broadly strengthen and as the end of the U.S. government shutdown failed to give much momentum to the greenback.

The euro has been strongly supported this year boosted by growing optimism the European Central Bank will signal a quicker exit than expected from its stimulus program.

was up 0.30% at a fresh three-yar peak of 1.2336.

The dollar only briefly rebounded after Congress on Monday to fund the government for around three weeks and President Donald Trump signed the bill, ending the three-day government shutdown.

The , which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.41% at a fresh three-year low of 89.51 by 05:15 a.m. ET (09:15 GMT).

The pound was also stronger, with up 0.59% at a 19-month high of 1.4087 after showed that the UK unemployment rate held at a 42-year low in November, in line with expectations, while wage inflation excluding bonuses unexpectedly increased.

On a less positive note, data also showed that the UK claimant count increased by 8,600 in December, disappointing expectations for a gain of 5,400 people.

Sterling has been strongly supported in recent sessions by growing optimism around chances the UK could secure a favorable Brexit deal.

The yen and the Swiss franc were stronger, with declining 0.62% to 109.65 and with retreating 0.65% to 0.9515.

The yen continued to be broadly supported by the Bank of Japan’s decision on Tuesday to leave its monetary policy unchanged.

Elsewhere, the Australian and New Zealand dollars were also higher, with up 0.67% at 0.8055 and with gaining 0.46% to 0.7389.

Meanwhile, dropped 0.48% to trade at 1.2360.

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