European session review: USD weakens as risk sentiment improves

USD fell against other major currencies in the European session on Monday as the latest news regarding stimulus negotiations between the U.S. House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin bolstered risk sentiment. 

The U.S. Dollar Index (DXY), measuring the U.S. currency's value relative to a basket of foreign currencies, dropped 0.35% to 93.35.

After weekend talks with the U.S. Treasury Secretary Steven Mnuchin, House Speaker Nancy Pelosi set a deadline of Tuesday for settling on terms of a new stimulus package in order to pass it before the November 3 election. According to Pelosi, the 48-hour deadline from Saturday "only relates to if we want to get it done before the election, which we do". In her letter to House Democrats on Sunday, Pelosi said she is "optimistic that we can reach agreement before the election."

However, the U.S. currency remained supported by rising coronavirus infections and uncertainty over the outcome of the presidential election.

According to the latest data from Johns Hopkins University, the number of COVID-19  infected people in the U.S. increased to 8,155,592, the most in the world. Meanwhile, the death toll from coronavirus reached 219,676, also the most in the world. Overall, the total number of confirmed global coronavirus cases rose to  40,076,184 and deaths grew to 1,113,962. Growing coronavirus cases fuel worries about the global economic outlook.

The updated polling data from the RealClear Politics (RCP) show that the gap between President Donald Trump and former Vice President Joe Biden has narrowed. Biden leads Trump by 9 points nationally based on the average of recent polls versus 10 points last week.