No Republican Support for Multi-Trillion Stimulus

More Worries for Trump as Presidential Race Heats Up

The dollar index closed 0.17% lower yesterday as it continues the reversal from its 1.8% advancement last week.

The greenback was under pressure as the Pelosi-Mnuchin negotiations have again failed to produce a deal. The House passed a $2.2 trillion Democrat-only fiscal stimulus package on Thursday which was rejected by the Republicans. 

Jobless figures continue to make the headlines, as no significant improvements were made to the number of Americans filing for unemployment benefits.

It was the fifth consecutive week with claims stuck at the 800 thousand level, pointing to a slowdown in the labor market recovery.

NFP figures released later today could provide further indication of a slowing economy.

Choppy Waters for the Eurozone

The euro advanced 0.23% higher on Thursday as it attempts to break away from the 1.17 handle.

Eurozone producer prices increased steadily in August, month-on-month, as was expected.

However, unemployment also rose for the fifth straight month due to the COVID-19 pandemic.

ECB President Christine Lagarde gave hints over a potential change of strategy. Possibly allowing inflation to overshoot the target after it has been low for too long.

EC Takes Legal Action Over Brexit Divorce Bill

The pound closed 0.22% lower yesterday as a 3-day ascension came to a halt.

With the latest round of Brexit negotiations set to wrap up today, the EU seems to be growing tiresome. The European Commission has started legal action against the UK over a breach in the Brexit divorce bill.

An EU deadline for Boris Johnson to remove sections of the Internal Market Bill expired. This could eventually lead to a court case against the UK.

However, the EU has stated that it has not walked away from talks over a post-Brexit trade deal.

How many stumbling blocks will there be until the end of this year?

Q4 Begins On a High, For Now

The major US indices all gained momentum on Thursday, as they continue their bid for fresh highs.

Netflix was the frontrunner as shares of the online streaming service rose by 5.5%. This supported the Nasdaq higher as it closed at 1.42%, its fifth positive session in six.

However, with President Trump’s quarantine and stalled stimulus talks, we could see a plunge on the indices as today’s session goes into full swing.

Risk-Off Rally Continues

Gold rose by over 1% as it reclaimed the $1,900 mark on Thursday. This was the highest finish in nearly two weeks for the yellow metal.

Risk appetite shifted towards gold as traders are concerned about fragile economic data coming out of America.

The focus will shift to the NFP figures later today to see how weak the greenback could become. This could lead gold prices back up to their lofty heights seen during the course of September.

Grim Reading For Oil

WTI fell by over 3% as it failed to hang onto the $39 handle.

Oil took another dive yesterday as OPEC’s production increased in September. The increase in seaborne exports also weighed heavily on oil, as Q4 starts off on a tender footing.