Buck has Mixed Action as Vaccine Euphoria Cools

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Buck has Mixed Action as Vaccine Euphoria Cools

NOVEMBER 10, 2020

The U.S. Dollar is erasing some of its losses from yesterday as the global market rally experienced is losing momentum as stock exchanges cool their engines. 

Overview

After a historic rise across the globe following news of a vaccine breakthrough by the pharmaceutical giant Pfizer, markets seem to have gauged reality and one that happens to be grim at the moment with records also in the number of infections and rapid flare-ups across Europe and the U.S.  Much of the opposite of what occurred yesterday morning is happening now, with Japanese yen and Swiss Franc benefiting from a return to doubt about virus control while all other commodity-based tender halted their resurgence against the buck.

As questions about the production and distribution of a vaccine haunt the economic recovery, some are also wondering if there will be a late move by President Trump and Congress to pass a stimulus package. Uncertainty remains over fiscal spending and the transition of power as legal challenges are mounted to the vote in tightly contested swing states.

Today may be a quiet one in the afternoon as the U.S.  gets ready to go on holiday on Wednesday in observance of Veterans Day. There could be some influence from a decision in China to control companies that threaten to monopolize internet services and Thursday is a major day as we hear from world central bankers and look into inflationary growth here.

What to Watch Today…

  • No major events scheduled for today

View this month’s Economic Calendar

REMINDER >> In observance of Veteran’s Day, Tempus will be closed on Weds, Nov. 11th.

Veteran's Day 2020

EUR  

The Euro has been trading within a 1.0% range in the last two sessions, managing to get close to multi-month levels but then easing down as the global positivity over vaccine treatments faded rapidly. Truth is we are likely to see some poor indicators by end of the month as already record hospitalizations put countries back in lockdown mode.

Additionally, the winter is set to be even more dangerous per medical experts who feel restrictions must be strictly abided by as other respiratory complications affect the general and more vulnerable population. 2021 is almost here, but we need to see progress in order not to downgrade our overall outlook for Euro as the struggle to overcome the pandemic continues.

GBP  

The Pound has found reasons to stay afloat and even keep gaining as Brexit talks come into focus, again, but with perhaps a changed attitude from the British side of things. Legislators have been wrestling with the idea of modifying the terms of negotiations as Prime Minister Boris Johnson had pushed for a more aggressive approach at the table. His cabinet had come up with an Internal Markets Bill trying to oppose and basically dismantle the Withdrawal Agreement that negotiators were working under that was agreed upon between the EU and the U.K.

Nevertheless, the House of Lords has decided to remove key clauses that would allow the U.K. to unilaterally re-write parts of the Withdrawal Agreement as desirable. As the lawmakers limit Johnson, the hope is to try meeting the end-of-year deadline and accommodate France and others with specific items that could get a trade deal going.

Catch the latest movements in FX in our November Currency Outlook

Monthly Currency Outlook
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