During the daily press briefing of Andres Manuel Lopez Obrador, it was announced that Mexico will receive 1.4 million doses of the vaccine by the end of January. Is that optimistic enough for the peso?
Greenback inches up on expectations for US-China trade negotiations
On Monday, the evergreen buck rallied versus a group of currencies, underpinned by hopes for trade negotiations that traders expect to relieve tensions between China and America.
Estimating the purchasing power of the US currency against its key rivals, the USD index rallied by 0.1% hitting 96.11 having dived by approximately 0.5% on Friday, which is the greatest losing day in nearly a month.
Escalating tensions between America and its trading partners, combined with a currency meltdown in Turkey brought the evergreen buck to 14-month maximums the previous week.
The greenback’s surge stalled ahead of expected trade negotiations between American and Chinese officials in the US capital in the coming days. Receding worries over the fallout from the Turkish currency’s recent selloff also relieved risk aversion, thus affecting US dollar demand.
On Monday, market sentiment toward Turkey managed to stabilize, with Turkey’s currency standing still sticking with the 6 lira to the greenback level. By the way, Turkish financial markets were unavailable due to holidays for the week.
The common currency went down versus the firmer greenback. The currency pair EUR/USD slumped by nearly 0.18% hitting 1.1416, which still appears to be above last Wednesday’s 13-month sink of 1.1300.
The evergreen buck rallied versus the Japanese yen. The currency pair USD/JPY added by up to 0.13% hitting 110.64 having slumped by 0.36% on Friday.
In addition to this, market participants were looking ahead to Wednesday’s minutes of the key US bank’s August gathering, when it left interest rates on hold and stressed that it’s still on track for extra rate lifts in 2018.
Market participants are going to be on the lookout for any changes in the Federal Reserve’s outlook on inflation as well as the trade war and economy worries.
The market optimism waned amid stricter restrictions to control rising coronavirus infections. S&P 500 and Nasdaq dropped from the all-time highs, while the USD jumped higher.
S&P 500 skyrocketed to the all-time high on optimism that Biden’s fiscal stimulus will support economic growth and boost corporate earnings.
PMI reports from the EU, the UK, and the USA will be released during the day!