Pound to US Dollar Hits Two-Month High on Coronavirus Vaccine Hopes

Pound (GBP) Buoyed by Vaccine Optimism

The Pound (GBP) secured some modest gains yesterday, with GBP investors welcoming the positive news regarding the Pfizer coronavirus vaccine as the UK is projected to receive 10 million doses by the end of 2020.

However, these gains were tempered somewhat by ongoing concerns regarding Brexit, as while UK-EU trade talks continue in London, there is still no sign of a breakthrough.

Meanwhile, the publication of the UK’s latest jobs report appears to have offered some support to GBP exchange rates this morning as a surprisingly strong bump in wage growth helped to offset concerns over another rise in unemployment.


Euro (EUR) Muted as Europe’s Coronavirus Battle Continues

The Euro (EUR) was left mostly rangebound through Monday, with the single currency seemingly unable to benefit from the sharp improvement in market sentiment.

While EUR investors no doubt welcomed the positive news regarding the coronavirus vaccine, the immediate focus remained on Europe’s current plight, with surging cases making a double-dip recession in the bloc almost unavoidable.

Coming up, we may see the Euro come up pressure this morning with the publication of the latest ZEW surveys as new lockdown measures across Europe are likely to have resulted in a souring of economic sentiment this month.


US Dollar (USD) Slips amid Positive Coronavirus Vaccine Reports

The US Dollar (USD) fell victim to another risk rally at the start of this week’s session, with investors shunning the safe-haven ‘Greenback’ following positive news regarding a potential coronavirus vaccine.

US pharmaceutical giant Pfizer announced that its experimental vaccine has shown 90% effectiveness in preliminary analysis, with the company planning to apply for emergency approval for use of the vaccine by the end of the month.

Turning to today’s session, the positive mood could continue to dampen the appeal of the US Dollar, although the publication of this afternoon’s JOLTs job opening figures could support USD exchange rates if job creation remained robust in September.


Canadian Dollar (CAD) Surges as Oil Prices Skyrocket

The Canadian Dollar (CAD) struck higher through Monday’s trading session, with the oil-sensitive ‘Loonie’ receiving a substantial boost from a surge in crude prices.

WTI crude prices soared over 10% to $41 a barrel during yesterday’s session as Pfizer’s vaccine announcement was viewed as a ‘game-changer’ by oil markets.


Australian Dollar (AUD) Muted on Lacklustre Chinese Inflation                

The Australian Dollar (AUD) found itself mostly rangebound overnight on Monday, with the China proxy ‘Aussie’ being undermined as China unexpectedly slipped into a state of deflation last month.


New Zealand Dollar (NZD) Firms in Risk-On Trade

The New Zealand Dollar (NZD) was able to maintain its upward trajectory in overnight trade, with the risk-sensitive ‘Kiwi’ benefitting from the latest vaccine news.

Matthew Andrews

Contact Matthew Andrews