The logo of the Bitcoin digital currency is seen in a shop in Marseille, France, February 7, 2021. Eric Gaillard, Reuters/File Photo
TOKYO - The dollar held ground on Thursday after its first back-to-back gains in two weeks as upbeat data bolstered expectations for the US to recover from the pandemic faster than most of its peers.
Bitcoin traded just shy of the new record high of $52,640 reached overnight, with its roughly 58 percent surge this month prompting some analysts to warn that the rally might be unsustainable.
Stimulus cheques helped US retail sales to rebound sharply in January, while industrial output and producer prices data also provided robust upside surprises.
Investors expect a further boost from Joe Biden's proposed $1.9 trillion COVID-relief package, with the president meeting top labor leaders on Wednesday to drum up support for the plan.
Meanwhile, minutes from the Federal Reserve's policy meeting last month reinforced the central bank's willingness to let the economy run hot while keeping monetary settings ultra-accommodative.
"Biden's stimulus plans, a steep decline in new infections and rapid vaccine rollout leave the US well positioned to recover sooner than most," Westpac strategists wrote in a client note.
"That will generate periodic bouts of USD upside."
However, like many analysts, Westpac's team expects the dollar to decline this year, weighed by the Fed's relentless money printing.
The dollar index was little changed at 90.89 early Thursday in Asia after strengthening 0.2 percent overnight and 0.4 percent on Tuesday.
The gauge has gained about 1 percent this year, rebounding from an almost 7 percent slide in 2020 that extended to a 2-1/2-year low of 89.206 in early January.
Westpac recommends fresh dollar index shorts on rallies toward 91.0. The euro was little changed at $1.2046 after sliding 0.5 percent overnight, the most in two weeks. The dollar was almost flat at 105.875 yen, following a pullback Wednesday after reaching a five-month high of 106.225.
Onshore trading of the Chinese yuan resumes Thursday following Lunar New Year holidays.
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