U.S. Election Day tomorrow, Fed Wednesday
NOVEMBER 02, 2020
The U.S. Dollar is trading in familiar ranges after a week that saw the U.S. Dollar pick up steam over its peers in the midst of heavy risk items ahead.
Today is the last day prior to Election Day in the U.S., which could go either way and affect market sentiment one way or the other. Experts are pointing out that historically the stock market goes up regardless of who gets the victory and FX trading this time could see quite a swing.
We could foresee these ranges for Euro, GBP, and CHF coming, especially after weeks of individual nations speculating on just how serious of a lockdown they may need to go into to prevent the infection uptick experienced the last month, which has broken records. One positive item is that mortality is decreasing, but to maintain society, we need hospitals to see far less action. The winter will be challenging no matter what.
Data-wise today we will get a look at October Purchasing Managers Index data focusing on Manufacturing at 9:45 AM, while the Institute of Supply Management figures in Manufacturing and Construction follow at 10 AM. Election tomorrow, but also keep in mind we get the Fed meeting on Wednesday, quite an interesting press conference that could be.
What to Watch Today…
- Markit Manufacturing PMI 9:45 AM
- ISM PMIs 10 AM
Missed last week’s webinar? Catch the recording about covering impacts of the USMCA Agreement…
The Euro did not improve although Manufacturing PMIs for Spain, France, Italy, and Germany all performed better than expected as surveys showed higher responses than September. The main item threatening the recovery in the Euro-zone is simply COVID-19 and the uptick that seems endless the past few weeks. We shall see what this week brings for EUR as the downward pressure of March and April seems on because of the medical concern at hand.
The Pound continues to feel some pressure as COVID-19 forced the U.K. government announced a 4-week lockdown and asking people to stock up on the essentials. Nevertheless, we could see the Pound return to gains rapidly as news this weekend regarding Brexit looked a bit more positive because France and the U.K. are trying to hammer out a solution to the fisheries issue.
France wants access to fishing waters of the English-French channel, which solidifies its food industry and employs many. Germany said they would like some flexibility from both sides, which made the two countries intensify the negotiations. We could see this resolved and consider it a major boost for Sterling. Again, hopes are high at the moment, but it won’t be done until it is done.