FOREX-Dollar dips on stimulus optimism, bets on Biden victory

* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E

(Adds details, updates prices; previous LONDON)
By Karen Brettell
NEW YORK, Oct 9 (Reuters) - The dollar fell to three-week lows on Friday as optimism that a deal for
new U.S. stimulus would be reached, and as investors bet that Democrat Joe Biden is more likely to win the
U.S. presidency and offer a larger economic package.
After stalling talks with Democrats on a comprehensive aid package earlier this week, U.S. President
Donald Trump on Thursday called for a "skinny" relief bill that would include elements such as direct
payments and a bailout of the struggling airline sector.
Senate Majority Leader Mitch McConnell said another rescue package was needed but noted "vast
differences" over costs. U.S. House of Representatives Speaker Nancy Pelosi said legislation to help
airline companies could only move through Congress with guarantees that a comprehensive aid bill would be
developed too.
“It seems like, at least in the White House, there is more of a sense of urgency that it needs to be
done,” said Bipan Rai, North American head of FX strategy at CIBC Capital Markets in Toronto. However,
“the key question for us is whether or not the Senate Republicans are going to go with it … they don’t
seem to be united.”
“I think we’re more or less in a standstill until we get some more clarity on whether or not this
stimulus package is going to go through,” Rai said.
The dollar index against a basket of major currencies fell 0.34% to 93.23, the lowest since
September 21. It has held within a range from 91.74 to 94.75 since late July.
The euro rose 0.45% to $1.1811. The greenback weakened 0.16% against the Japanese yen to
105.84 yen.
The U.S. currency also fell on rising expectations that Biden will win the Nov. 3 election, and that
Democrats could win the Senate. A Democratic victory would likely result in larger stimulus, which would
be negative for the dollar.
Rising expectations of a Biden victory has also boosted appetite for currencies that have been hurt by
the trade war between Washington and Beijing, with the Chinese currency the biggest beneficiary.
The offshore yuan strengthened to 6.6801, the strongest since April 2019.
The pound was steady, brushing off worse than expected UK growth data as investors became more
optimistic about a Brexit deal being reached ahead of a key European Council summit next week.

Sterling was last up 0.29% at $1.2970.
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Currency bid prices at 9:24AM (1324 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR= $1.1811 $1.1758 +0.45% +5.36% +1.1817 +1.1754
Dollar/Yen JPY= 105.8400 106.0100 -0.16% -2.77% +106.0400 +105.8200
Euro/Yen EURJPY= 125.00 124.69 +0.25% +2.50% +125.0900 +124.5300
Dollar/Swiss CHF= 0.9116 0.9167 -0.56% -5.81% +0.9177 +0.9116
Sterling/Dollar GBP= 1.2970 1.2933 +0.29% -2.18% +1.2976 +1.2922
Dollar/Canadian CAD= 1.3141 1.3194 -0.40% +1.19% +1.3202 +1.3132
Australian/Doll AUD= 0.7213 0.7166 +0.66% +2.73% +0.7218 +0.7161
ar
Euro/Swiss EURCHF= 1.0770 1.0780 -0.09% -0.76% +1.0789 +1.0769
Euro/Sterling EURGBP= 0.9107 0.9087 +0.22% +7.72% +0.9131 +0.9077
NZ NZD= 0.6638 0.6572 +1.00% -1.45% +0.6642 +0.6576
Dollar/Dollar
Dollar/Norway NOK= 9.1798 9.2623 -0.89% +4.57% +9.2751 +9.1786
Euro/Norway EURNOK= 10.8450 10.8940 -0.45% +10.24% +10.9109 +10.8413
Dollar/Sweden SEK= 8.8142 8.8565 -0.11% -5.70% +8.8736 +8.8136
Euro/Sweden EURSEK= 10.4087 10.4202 -0.11% -0.58% +10.4510 +10.4110


(Additional reporting by Saikat Chatterjee in London
Editing by Nick Zieminski)