The dollar fell to a multi-year low against many currencies on Wednesday as currency traders looked at a new delay in U.S. stimulus measures and kept rates, additional financial assistance was still likely.
The US dollar hit its weakest level in more than two years against the euro, the Australian dollar and the New York dollar.
The dollar also fell to its lowest level in five years against the Swiss franc and generally fell against Asian currencies.
U.S. Senate Majority Leader Mitch McConnell on Tuesday blocked an immediate review of a measure to increase Covid-19 aid payments to $2,000, adding another twist to fragmented fiscal stimulus talks.
The dollar has been falling steadily since U.S. President Donald Trump signed the Coronary Aid and Expenditure Act on Sunday because additional stimulus for the world's largest economy reduces demand for the supposed security of the dollar.
While the size of the concessional payments is still uncertain, many analysts say the dollar is likely to resume falling next year, as President-elect Joe Biden is expected to push for even more economic support.
"Our weak call to the dollar remains intact in 2021," BBH analysts wrote in an analysis note.
What will happen to the dollar... much depends on how well the United States controls the virus in 2021, as well as the prospects for further fiscal stimulus."
The dollar fell to $1.2295 per euro on Wednesday in Asia, the weakest since April 2018.
The British pound rose to $1.3543.
Against the Swiss franc, the dollar hit 0.8819, the weakest since January 2015.
The dollar fell to 103.27 yen.
Low liquidity may have exaggerated some market movements when many investors left for the holiday at the end of the year.
A light data calendar in Asia is also likely to leave traders with little incentive to open larger positions.
The dollar index against a basket of six major currencies was at 89.759, the lowest in two years.
The last-minute standoff has cast doubt on some details of the U.S. aid package, but many analysts say the U.S. government will continue to implement fiscal stimulus in one form or another because the second wave of coronavirus infections is becoming a big threat to the economy.
In addition, many investors are already anticipating a new government led by Biden when he is sworn in on January 20.
Another negative factor for the US dollar is the expectation that the US Federal Reserve will keep interest rates low for an extremely long time, many analysts say.
Elsewhere, both the Australian dollar and the New York dollar hit their strongest levels in 2 1/2 years. These currencies are considered to be barometers of risk appetite due to their association with global commodities.
The yuan onshore rose to $6.5227.
Korean won and Malaysian ringgit also rose against the backdrop of broad dollar sales.