Pound (GBP) Slumps on Brexit Jitters
The Pound (GBP) suffered heavy losses on Wednesday, with the UK currency erasing the previous day’s gains after EU chief Brexit negotiator Michel Barnier poured cold water on suggestions talks had entered the ‘tunnel’.
Barnier reportedly told EU officials that a trade deal ‘hangs in the balance’, as talks remain stuck on the issues of fishing rights, governance and the level playing field.
Brexit will undoubtedly continue to dominate Sterling sentiment through the remainder of the week, liking giving way to further losses unless a breakthrough is forthcoming.
Euro (EUR) Strengthened by Coronavirus Vaccine Optimism
The Euro (EUR) trended higher on Wednesday following the news that the UK had approved the Pfizer coronavirus vaccine for roll out next week.
It’s expected that the EU and US will likely be quick to follow the UK in granting the vaccine the green light, hopes for which helped to bolster market sentiment in mid-week trade.
Looking ahead, the focus for EUR investors this morning will be on the Eurozone retail sales figures. Will a rebound in sales growth in October allow the Euro to continue its recent run of gains?
US Dollar (USD) Slips amid Stimulus Hopes
After falling sharply through the first half of the week, the pace of the US Dollar (USD) sell-off slowed markedly yesterday, but not enough to prevent the USD/EUR exchange rate striking a new two-year low.
This came as speculation of a new US stimulus package helped to underpin market sentiment and limit demand for the safe-haven ‘Greenback’.
Coming up, the spotlight for USD investors today will be on the latest ISM non-manufacturing PMI, where a potential slowing of activity in the US service sector could weigh on the US Dollar.
Canadian Dollar (CAD) Stable as Oil Prices Flat Ahead of OPEC Meeting
The Canadian Dollar (CAD) was mostly rangebound through yesterday’s trading session, with the commodity-linked currency struggling to find momentum as crude prices stalled ahead of today’s OPEC meeting regarding oil production cuts.
Australian Dollar (AUD) Bolstered by Strong Trade Figures
The Australian Dollar (AUD) rallied overnight on Wednesday, finding support from some stronger-than-expected domestic trade figures as well the prevailing risk-on tone.
New Zealand Dollar (NZD) Rallies in Upbeat Trade
The New Zealand Dollar (NZD) also trended higher in overnight trade, with the appeal of the risk-sensitive ‘Kiwi’ being boosted by improving market sentiment and broad USD weakness.