TOKYO, Sept 28 — The US dollar hovered near a two-month peak against at a basket of currencies today as investors look to a barrage of upcoming economic data and political developments in the United States before making any fresh bets on the US currency.

While a rebound in US stocks on Friday has helped to curb the ascent of the US dollar, deemed as a safe-haven, signs of slowdown in the nascent economic recovery and political uncertainties have kept investors on guard.

The US dollar index stood at 95.544. Last week it hit a two-month high of 94.745 last week and posted its biggest weekly rise since early April.

The euro changed hands at US$1.1635, having dropped to US$1.16125 on Friday to its lowest level in two months.

Advertisement

The British pound stood at US$1.2767, slightly above Wednesday's two-month low of US$1.2676.

Data on US currency futures positions released on Friday pointed to more upside in the dollar's recovery, with speculators holding a big net short position in the greenback.

Data from US Commodity Futures Trading Commission showed speculators held a net short position of US$33.989 billion (RM141.7 billion), up from US$31.524 billion the week before and near the highest level in almost 10 years.

Advertisement

The flip side of that was a still very large net long positions in the euro, which showed a slight increase last week to US$27.922 billion.

“We need to be wary of a weaker euro due to further unwinding of euro long positions. We have no shortage of concerns in Europe including rise of coronavirus infections in France and so on, attempts by European Central Bank policymakers to talk down the euro and the Brexit,” Makoto Noji, chief currency strategist at SMBC Nikko Securities said in report.

Against the yen, the US dollar was more subdued at 105.46 yen .

Investors now look to the first US Presidential debate tomorrow as the election in early November has started to loom large.

“Few people will be trying to bet on the election outcome. At least they will wait until tomorrow's TV debate,” said Kyosuke Suzuki, director of forex at Societe Generale.

Ahead of the debate, the New York Times reported yesterday President Donald Trump paid extremely little in income taxes in recent years as heavy losses from his business enterprises offset hundreds of millions of dollars in income.

Few investors now expect the US Congress to pass any stimulus package, seen as vital to support the pandemic-stricken economy, before the election.

But there are growing worries the economic recovery is slowing as many of the stimulus programmes have expired, curbing consumer spending.

The week provides markets with more US data to gauge the health of the world's biggest economy, including consumer confidence tomorrow, manufacturing survey on Thursday and jobs data on Friday. — Reuters