Dollar hovers near more than one-year low on U.S. stimulus, vaccine optimism

The dollar hovered near a 2 1/2 -year low against a basket of currencies on Thursday as traders hoped for additional stimulus aid from Washington and as the anticipated COVID-19 vaccinations would likely boost risk assets.

Even if Republicans and Democrats in Congress failed to reach an agreement on a new stimulus aid, there were signs that a $908 billion bipartisan proposal is probable.

The euro stood at $1.2113 after hitting its highest level since April 2018 in the last session. The dollar index dropped to a 2 ½-year low of 90.987 on Wednesday and recovered slightly to 91.040 on Thursday.

The dollar firmed at 104.46 against the yen, while the Aussie traded at $0.7418 after hitting a 26-month high in the last session. 

In offshore trade, the yuan bought 6.5468 per dollar, near a 2 ½-year high hit last month. The pound steadied just below a three-month high of $1.3370.