2023.03.2720:34:00UTC+00Dollar Loses Ground As Risk Sentiment Improves

The U.S. dollar turned in a weak performance on Monday as easing worries about global banking sector woes helped lift sentiment and prompted investors to seek riskier assets such as equities.

Global stocks rallied after Federal Deposit Insurance Corp. or FDIC announced an agreement, under which First-Citizens Bank & Trust Co., affiliated to First Citizens BancShares, Inc., will buy all deposits and loans of Silicon Valley Bridge Bank, N. A. out of FDIC receivership.

Sentiment was also underpinned after U.S. Fed officials said there was no indication that financial stress was worsening.

The U.S. Financial Stability Oversight Council said the U.S. banking system was "sound and resilient" despite stress on some institutions.

German Chancellor Olax Scholz said during a news conference in Brussels that Deutsche Bank remains profitable and there's no reason to doubt its future.

The dollar index dropped to 102.84, losing about 0.28%, after having climbed higher at one point during the Asian session.

Against the Euro, the dollar weakened to 1.0801 from the previous close of 1.0762.

The dollar is trading at 1.2291 against Pound Sterling, easing from 1.2232.

Against the Japanese currency, the dollar rose to a five-day high, advancing to 131.78 yen, before paring some gains. It is currently trading at 131.58 yen, up 0.66% from the previous close.

Against the Aussie, the dollar is trading at 0.6651, down slightly from 0.6646.

The Swiss franc is stronger at CHF 0.9156 a dollar, gaining from CHF 0.9199.

Against the Loonie, the dollar is weak at C$1.3657, as oil prices rose sharply on supply concerns. Oil prices climbed higher amid easing worries over a banking crisis and comments from Russian President Vladimir Putin that he will station tactical nuclear weapons in Belarus.