(Adds details, updates prices; changes byline, dateline; previous LONDON)
- Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
The dollar fell on Wednesday as stocks surged after Gilead Sciences reported an encouraging update on a potential treatment for the novel coronavirus, which has shut down businesses and battered the global economy.
Gilead's GILD.O experimental antiviral drug remdesivir helped improve symptoms in COVID-19 patients who were given the drug early more than among those who were treated later, the company said.
It also comes as optimism grows that businesses globally are getting closer to reopening, which has boosted risk appetite and reduced demand for the U.S. currency.
“We’re seeing increasing chatter about economies opening up around the world, so that would suggest that the global economic reboots could happen sooner rather than later,” said Joe Manimbo, senior market analyst at Western Business Solutions on Washington. “That’s risk positive and negative for (safe) haven assets.”
The greenback fell 0.26% against a basket of currencies =USD to 99.62, above a two-week low of 99.44 hit on Tuesday.
The Australian dollar AUD= , which is seen as a proxy for global growth, jumped 0.57% to $0.6527. It earlier reached $0.6547, the highest since March 10.
The greenback also dipped after data showed that the U.S. economy contracted in the first quarter.
The Commerce Department said gross domestic product fell at a 4.8% annualized rate in the January-to-March period after expanding at a 2.1% rate in the final three months of 2019.
The dollar reaction to the data was not “huge,” but “I think it’s going to pour cold water over hopes of a V-shape recovery. And I think it also validates fears that second-quarter growth could be in line with some of the more dire forecasts of a 40% contraction,” Manimbo said.
The Federal Reserve will conclude its two-day meeting later on Wednesday, when policymakers are expected to keep their promise to do whatever it takes to support the world's largest economy.
The dollar has weakened more than 3% after scaling a more than three-year peak of 102.99 in late March as global central banks launched massive stimulus measures to protect economies from the coronavirus pandemic.
The euro EUR=EBS gained 0.43% to $1.0865 before a European Central Bank meeting on Thursday.
======================================================== Currency bid prices at 9:37AM (1337 GMT)Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid Previous Change Session Euro/Dollar EUR= $1.0865 $1.0818 +0.43% -3.08% +1.0874 +1.0819 Dollar/Yen JPY= 106.5700 106.8600 -0.27% -2.10% +106.8900 +106.3700 Euro/Yen EURJPY= 115.80 115.62 +0.16% -5.04% +115.9200 +115.4600 Dollar/Swiss CHF= 0.9713 0.9750 -0.38% +0.36% +0.9754 +0.9714 Sterling/Dollar GBP= 1.2443 1.2421 +0.18% -6.16% +1.2485 +1.2390 Dollar/Canadian CAD= 1.3924 1.3993 -0.49% +7.22% +1.4003 +1.3918 Australian/Doll AUD= 0.6527 0.6490 +0.57% -7.04% +0.6547 +0.6487 arEuro/Swiss EURCHF= 1.0555 1.0549 +0.06% -2.74% +1.0575 +1.0548 Euro/Sterling EURGBP= 0.8731 0.8705 +0.30% +3.28% +0.8755 +0.8695 NZ NZD= 0.6099 0.6054 +0.74% -9.46% +0.6114 +0.6052 Dollar/DollarDollar/Norway NOK= 10.3313 10.3962 -0.62% +17.69% +10.4387 +10.3340 Euro/Norway EURNOK= 11.2260 11.2548 -0.26% +14.12% +11.2983 +11.2253 Dollar/Sweden SEK= 9.8695 9.8838 +0.26% +5.59% +9.9007 +9.8431 Euro/Sweden EURSEK= 10.7251 10.6978 +0.26% +2.44% +10.7355 +10.6891 <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Major Fx IMAGE https://tmsnrt.rs/2Si905D^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
