The dollar dipped against riskier currencies on Tuesday as hopes for a Covid-19 vaccine and big corporate deals improved investor appetite for riskier currencies.

The yuan jumped to a 16-month high as a series of Chinese data points to steady economic recovery in China while the Australian dollar was bolstered by policy minutes from the country’s central bank which stopped short of signalling a further cut to the cash rate.

The dollar index slipped to 92.910, pulling away further from a one-month high of 93.664 touched last Wednesday.

The euro inched up 0.2% to $1.1889, extending its rise into a fifth straight day, with an initial resistance seen at around last week’s high of $1.1917.

The dollar traded at 105.66 yen, near its two-week low of 105.55 yen touched on Monday.

Helping sentiment, AstraZeneca resumed British clinical trials of its Covid-19 vaccine, one of the most advanced in development, while Pfizer Inc and BioNTech SE proposed expanding their phase three vaccine trial.

“It was uplifting that Pfizer has made clear a target of vaccines. As risk assets bounced back, the dollar has lost momentum,” said Kyosuke Suzuki, director of forex at Societe Generale.

Wall Street shares recovered as several multi-billion dollar deals – including Nvidia’s $40 billion purchase of chip designer Arm – lifted confidence.

The Australian dollar gained 0.4% to $0.7316, as highly anticipated minutes from the central bank’s September monetary policy meeting gave no hint that record low interest rates will be cut further.

The Chinese yuan rose to a 16-month high in both offshore and onshore trade, thanks to China’s robust economic fundamentals.

Industrial output accelerated the most in eight months in August, while retail sales grew for the first time this year, suggesting the economic recovery is gathering pace as demand starts to improve more broadly from the coronavirus crisis.

“We have evidence of strong exports from China while Chinese tourists, who would have spent $260 billion overseas in normal years, are not going abroad this year, reducing yuan selling,” said Ei Kaku, senior strategist at Nomura Securities.

“Chinese authorities have not tried to rein in the yuan’s rise for the past couple of weeks even as it has strengthened, leading people to expect further appreciation in the yuan.”

The yuan’s strength helped to lift MSCI emerging market currency index to a six-month high.

The British pound bounced back to $1.2855, following a fall of 3.66% last week, showing limited reaction after the UK government won an initial Parliamentary vote on its controversial bill to violate the Brexit deal with the European Union.

Still, traders said the currency looks vulnerable as the EU warns British Prime Minister Boris Johnson’s bill would collapse trade talks and propel the United Kingdom towards a messy Brexit.

Investors now look to central bank policy meetings in the United States on Wednesday and in Japan and Britain on Thursday.

This week’s Federal Reserve meeting will be its first since Chairman Jerome Powell unveiled a shift toward greater tolerance of inflation, effectively pledging to keep interest rates low for longer.

Projections from Fed policymakers that inflation will remain below 2% in their economic forecasts, to be extended to 2023 this time, could strengthen expectations that interest rates will stay low for a long period of time, analysts say.