Reality Hits Tremulous Dollar
The dollar index fell 0.54% lower yesterday as it once again touched the 90 level.
The recent rally paused as the dollar shed some ground for the first time after four consecutive daily gains.
Investors looked past the potential impeachment of President Trump, focusing instead on the likely increase of fiscal stimulus under a Biden administration and the impact on inflation expectations.
This comes after the third most senior Republican, Liz Cheney, said she would vote to impeach Donald Trump over last week’s Capitol riot.
The House plans to vote today to charge Mr. Trump with inciting insurrection, which would make him the first US president ever to be impeached twice.
Euro Breaks Back
The euro managed to climb 0.45% higher on Tuesday, pushing back through the 1.22 ceiling.
Investors dumped their dollars yesterday, leading to a slight rally on the EURUSD pair.
This comes despite analysts predicting a sharp contraction in the first quarter of the year, with further Covid-19 restrictions taking their toll.
Double-dip recessions could be a common thing going into the start of the new year, as we await today’s industrial production numbers to lift spirits.
Sterling Pushes for 2-Year Highs
The pound had a day to remember yesterday, jumping over 1% as it reached for the 1.37 handle.
With the Bank of England ruling out negative interest rates, the governor said that quantitative easing would continue this year, with a further £150bn of asset purchases in the pipeline.
Mixed Day for Indices
The three major US indices all traded towards breakeven status on Tuesday.
This comes as several major tech giants continued to slide after sharp declines at the start of the trading week.
Twitter and Facebook continue to feel the brunt of the sell-off, as both stocks fell by over 2%.
Tesla shares rallied once again, as the stock remains near all-time highs.
Gold Begins Recovery
Gold closed 0.58% higher on Tuesday as the upturn begins after last week’s collapse.
The greenback’s decline is keeping bulls hopeful, amid expectations of a multitrillion-dollar stimulus likely to be announced by President-elect Joe Biden soon.
Added to the pandemic numbers and the civil unrest, could we see the yellow metal make a full retracement?
Oil at 11-Month High
WTI jumped over 2% yesterday, eclipsing the $53 handle.
Strong API figures showed a large crude draw which led the black gold higher. The rally now looks towards EIA figures released later today, as a further move would cement a push towards $60.