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Dollar Decline Continues As Investors Parse Economic Data, Earnings

The U.S. dollar edged lower on Monday as investors looked to upcoming global economic data and U.S. corporate earnings to gauge whether guarded optimism on the economic outlook is justified.

The dollar ended its third week of losses on Friday as investors bought into risk-sensitive currencies on bets that the worst of the pandemic’s sweeping impact was over.

The index that measures it against a basket of major currencies had slipped 0.2% by midday in London to 96.481.

U.S. coronavirus cases surged over the weekend, as Florida reported an increase of more than 15,000 new cases in 24 hours, a record for any state, surpassing a peak hit in New York in April.

“We expect a broad dollar decline to continue, supporting emerging market FX (despite local coronavirus issues) and see euro/dollar at $1.15 in 3 months,” Lars Sparresø Merklin, senior FX analyst at Danske Bank, said in a note to clients.

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