By Hideyuki Sano
TOKYO (Reuters) – The dollar was softer against riskier currencies on Tuesday on rising optimism that U.S. lawmakers could agree on new stimulus to blunt the economic impact of the coronavirus.
Risk appetite also improved after U.S. President Donald Trump left the hospital and returned to the White House following treatment for COVID-19, a development viewed as reducing political uncertainties in the near term.
“I think hopes of U.S. stimulus are the main driving force,” said Masafumi Yamamoto, chief currency strategist at Mizuho Securities.
“As for Trump’s discharge, the impact is not clear-cut but it is seen as positive for risk environment to the extent that there are less worries about the White House getting caught in complete chaos and unable to make decisions,” he said.
The euro traded at $1.1792 <EUR=>, following a gain of 0.58% on Monday.
The pound changed hands at $1.2990 <GBP=D4>, tackling its resistance around $1.30, despite concerns about a no-deal Brexit.
The dollar advanced on the safe-haven yen to 105.66 yen <JPY=>, staying near its highest levels in three weeks.
The dollar’s index against a basket of six major currencies <=USD> dropped to 93.381, touching its lowest level in two weeks.
U.S. House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin spoke by phone for about an hour on Monday on coronavirus economic relief and were preparing to talk again Tuesday, continuing their recent flurry of activity working towards a deal on legislation.
White House Chief of Staff Mark Meadows said there is still potential for an agreement among lawmakers in Washington on more economic relief, and that Trump is committed to getting the deal done.
However, renewed efforts in Congress to reach an agreement on relief funds for the pandemic-hit economy has been complicated by the spread of the coronavirus