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Expand chart
Data: FactSet; Chart: Axios Visuals

The dollar index, which tracks the greenback's value against a basket of currencies, touched its lowest level in over two years.

What's going on: Investor sentiment soared this month — following Biden’s win and prospects of congressional gridlock, possible stimulus, and headway on coronavirus vaccines.

  • Investors shifted into riskier assets — leaving the dollar to fall 2.5% this month.
  • The New Zealand dollar, on the other hand, is on track for its biggest monthly gain in seven years.

What they're saying: The worsening pandemic and uncertainty over OPEC+ moves shouldn't cloud the "generally positive risk environment, which has seen around $36 billion worth of portfolio flows returning to emerging markets over the last month — largely at the expense of the dollar,” ING strategists wrote.

  • “While more lockdown restrictions may stand to curb U.S. equity markets, the prospect of the Fed being prepared to add more liquidity should limit any dollar upside.”

Go deeper

Dion Rabouin, author of Markets
Jan 12, 2021 - Economy & Business

The big hedge

Illustration: Aïda Amer/Axios

Warnings that the U.S. equity market looks to be in a bubble are coming from a slew of Wall Street asset managers and strategists as stocks continue to reach new record highs and markets display abnormal behavior. But data show that while investors are hedging their bets, there is hardly a mad dash to sell out of equity positions.

What's happening: As the 10-year Treasury yield rises solidly above 1% — its highest level in nearly a year — a growing contingent of investors fear that a crash is imminent without the ballast of rock-bottom interest rates.

OIG: HHS misused millions of dollars intended for public health threats

Vaccine vials. Photo: Punit Paranjpe/AFP via Getty Images

The U.S. Office of Special Counsel alerted the White House and Congress on Wednesday of an investigation that found the Department of Health and Human Services misused millions of dollars that were budgeted for vaccine research and public health emergencies for Ebola, Zika and now the COVID-19 pandemic.

Why it matters: The more than 200-page investigation corroborated claims from a whistleblower, showing the agency's violation of the Purpose Statute spanned both the Obama and Trump administrations and paid for unrelated projects like salaries, news subscriptions and the removal of office furniture.

John Kerry: U.S.-China climate cooperation is a "critical standalone issue"

President Biden's special climate envoy John Kerry said Wednesday that the U.S. must deal with China on climate change as a "critical standalone issue," but stressed that Beijing's human rights and trade abuses "will never be traded" for climate cooperation.

Why it matters: The last few years have brought about a bipartisan consensus on the need for the U.S. to confront China's aggression. But as the world's largest greenhouse gas emitter, China will be a vital player if the world is going to come close to reining in emissions on the scale needed to meet the Paris Agreement goals of limiting warming to 2°C above pre-industrial levels.

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