2020.12.1706:46:00UTC+00U.S. Dollar Falls On Stimulus Hopes, Fed Policy Statement

The U.S. dollar depreciated against its major counterparts in the Asian session on Thursday, as the Fed committed to keep its benchmark interest rate near zero and on improved risk sentiment amid hopes of fiscal stimulus in the United States.

The Fed kept the short-term interest rates unchanged at the range of 0.0 percent and 0.25 percent and said that it will continue its asset purchase program until the economy shows substantial progressed towards the central bank's goals of maximum employment and price stability.

Congressional leaders edged closer towards a $900 billion aid package, which includes stimulus checks, funding for small businesses and extended unemployment benefits.

"We're still close and we're gonna get there," U.S. Senate Majority Leader Mitch McConnell of Kentucky told reporters.

Investors await economic reports on U.S. weekly jobless claims, housing starts and Philadelphia-area manufacturing activity due later in the day.

The greenback weakened to 103.21 against the yen, its lowest level since November 9. The currency is likely to find support around the 101.00 level.

The greenback edged down to 0.8834 against the franc, from a high of 0.8858 seen at 7:15 pm ET. If the dollar slides further, 0.86 is possibly seen as its next support level.

The greenback dipped to 2-1/2-year lows of 1.2236 against the euro and 1.3574 against the pound, from yesterday's closing values of 1.2197 and 1.3508, respectively. The greenback is seen finding support around 1.24 against the euro and 1.37 against the pound.

The U.S. currency reached as low as 1.2707 against the loonie, compared to Wednesday's close of 1.2740. Next likely support for the greenback is seen around the 1.24 level.

The greenback was lower against the aussie and the kiwi, touching 2-1/2-year lows of 0.7615 and 0.7145, respectively. The greenback had ended yesterday's deals at 0.7575 against the aussie and 0.7111 versus the kiwi. The greenback is poised to challenge support around 0.78 against the aussie and 0.74 against the kiwi.

Looking ahead, the Swiss National Bank's monetary policy announcement will be out at 3:30 am ET. Economists widely expect the central bank to maintain policy rate at -0.75 percent.

Eurozone final CPI for November will be released in the European session.

The Bank of England's monetary policy announcement is due at 7:00 am ET. The Monetary Policy Committee is widely expected to hold the key rate at a record low of 0.10 percent and the quantitative easing programme at GBP 825 billion.

The U.S. weekly jobless claims for the week ended December 12 and housing starts and building permits for November are scheduled for release in the New York session.