Trump Appeals for Larger Stimulus
The US dollar dropped by 0.24% yesterday, falling back to the lowest levels seen since April 2018.
Progress on additional US stimulus saw fresh selling and a move back below the 90.00 mark.
This comes as President Trump challenges the Senate to increase stimulus cheques to the American public.
As we head into 2021, will the greenback sink any lower?
Euro Braces for 1.23
The euro closed 0.26% higher on Tuesday, printing a three-day winning streak whilst crossing multi-month highs.
With the fight against the coronavirus increasing, sentiment remained that an economic recovery is going to be evident going into 2021.
The mood on the trading floor looks a little lighter going into the new year, with a $900 billion rescue package signed off with a post-Brexit deal.
Millions More Braced for Tougher Restrictions
The pound was up by 0.39% yesterday as investors calmed down over Britain’s long-awaited Brexit deal with the EU.
Even the FTSE was able to capitalize on the positive sentiment, as the index jumped 2.2% higher.
However, there was a hint of caution as the highest single day of Covid-19 cases were recorded on Tuesday.
The government is urging more and more people to stay at home, as tougher Tier measures come into place amid escalating infection numbers.
Nasdaq Reaches Record Highs Again
The Nasdaq was yesterday’s top performer after clinching further fresh highs. This was a role reversal from the S&P and Dow, as they both ended a 3-day winning run.
As the Santa Claus rally comes to fruition, one has to wonder if another sell-off in the equity market will ensue as we enter 2021.
Gold Edges Higher as Risk Appetite Takes a Turn
Gold closed 0.22% up on Tuesday, posting a slight gain as the greenback softened.
However, early indications show that this could be purely because the risk-on trade could cool off as we start the new year.
The first strain of the new mutated coronavirus recorded in the US could see further hospitalizations, leading to sentiment shifting once again.
Oil Back in the Race
WTI closed almost 1% higher yesterday as it broke back through the $48 ceiling.
The black gold gained ground on Tuesday as the US coronavirus fiscal aid package and a decline in crude oil inventories lifted prices.
The API reported a much larger draw versus consensus, heightening sentiment as we enter 2021.