Dollar Dropped as Markets Hone In On Stimulus Prospects

The greenback was once again the poorest performer in G10, with decent risk appetite in equity space sapping the USD of any safe haven status. Market focus remains on US stimulus deal prospects, with reports suggesting that differences are continuing to narrow, with just the final details remaining in a package worth up to $900bln.

At the other end of the table, the NOK was stronger against all others Thursday following the Norges Bank rate decision. The Bank sharply steepened their rate path projections, bringing forward the timing of the first rate hike by around six months to mid-2022.

Despite recent outperformance, GBP was distinctly mid-table Thursday after solid gains were sold into the close after the conclusion of a phonecall between UK's Johnson and EU's von der Leyen. Both sides cautioned that no deal remained a real possibility, with distinct differences remaining between both sides.

Focus Friday turns to German IFO data and Canadian retail sales. The Russian central bank rate decision is also due.