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 surges on less dovish remarks from Fed’s Clarida
On Tuesday, the US dollar ascended after less dovish remarks from Fed Vice Chairman Richard Clarida.
Gauging the purchasing power of the major US currency versus its main counterparts the USD index managed to surge by up to 0.19% being worth 97.16.
On Tuesday, Clarida told that interest rates happen to be neutral. The major financial institution requires taking a gradual approach to lifting interest rates based on data, Clarida told.
As the American economy has shifted to a neighborhood consistent with the US major bank’s dual-mandate goals, risks have become less skewed and more symmetric to the downside than when the current interest rate cycle started three years ago, Clarida told.
The statesman’s remarks helped to underpin the US dollar that often goes up when interest rates are lifted.
Meanwhile, the evergreen buck was kept in check by China-US trade fears after US leader Donald Trump said in his interview with the Wall Street Journal that he won’t probably cease lifting tariff rates on China on January 1.
The greenback managed to go up versus the safe-heaven Japanese yen. The currency pair USD/JPY headed north by 0.11% coming up with 113.71. In hard times, investors are prone to investing in Japan’s currency that is considered a reliable asset for periods of risk aversion.
As for the common currency, it headed south too because of the stronger evergreen buck. As a matter of fact, the currency pair EUR/USD slumped by 0.18% being worth 1.1308.
Additionally, the UK currency was still low. The currency pair GBP/USD went down to 1.2747 after US leader told that the Brexit draft deal appears to be a good deal for the European bloc, backing fears that the United Kingdom won’t be able to trade as easily with his country.
Poor US data, slow vaccine distribution, rising virus cases worsened the market sentiment and underpinned safe-haven currencies like the USD, and JPY.
The European Central Bank will publish the monetary policy statement with the interest rate decision on January 21, at 14:45 MT time.
Joe Biden is going to unveil a Covid-19 relief package of about $2 trillion. After this announcement, the 10-year Treasury yield rose, adding support for the USD.