Over the weekend Joe Biden was able to win the race to the White House by being first candidate in the 2020 election to surpass 270 electoral votes. President-Elect Biden won 50.7% of the vote by attaining over 75M votes – the most votes ever gained by a U.S. presidential candidate. Worryingly, Donald Trump was able to get over 70M votes, which is the 2nd most votes ever attained by a candidate, exceeding even former President Barrack Obama’s 2008 record count of 69M. This highlights the fathomless division that currently exists in the United States and leads to more uncertainty as it appears Donald Trump will not hand-over the Presidency without a fight.
At 07:31 this morning cable was able to test the 1.32 mark, reaching a 2-month high of 1.3199. On Friday when markets were still awaiting a result from across the pond, GBPUSD opened strong at 1.3145; and after a turbulent trading session was able to close above the open at 1.3161.
EURUSD was also able to reach a 2-month high of 1.1898 this morning. The pair opened the day Friday at 1.1840 and was able to make decent moves to the upside during the session, closing well above where it started the day at 1.1885.
On the Brexit front, UK and EU officials have resumed trade talks in London today following another “taking stock” conversation between Johnson and European Commission President Ursula von der Leyen on Saturday. Reports from the weekend suggest that “while some progress had been made in recent discussions, significant differences remain in a number of areas, including the so-called level playing field and fish” a Downing Street spokesperson has noted.
Johnson on Sunday reiterated his “great” enthusiasm “for a trade deal with our European friends and partners”, claiming that “the broad outlines are pretty clear, we just need to get on and do it if we can”.
As the pair looks for more clarity on Brexit, GBPEUR lost its grip on the 1.11 handle on Friday as the pair slipped into the 1.10 range once again. The pair opened the session at 1.1102 and closed at 1.1074
Despite not officially being President quite yet, President-Elect Biden has already pitched in on the UK and EU relationship, stating that “any trade deal between the US and UK must be contingent upon respect for the Agreement and preventing the return of a hard border. Period.” Biden’s comments echo those of the house Democrats who have said it was “disturbed” to hear reports of the PM’s “efforts to undermine the Northern Ireland protocol”, noting that “many in the United States and Congress consider the issues of the Good Friday Agreement and a potential US-UK Free Trade Agreement inextricably linked.” Even the speaker of the House Nancy Pelosi stated last week that there is “absolutely no chance” of an agreement if the UK breached protocol.
While Monday is light on economic releases, we have a plethora of speeches from notable central bankers. From the ECB we have President Lagarde speaking at 09:25 and Yves Mersch at 12:00. From the Bank of England, Governor Andrew Bailey is due to speak at 10:35 and Andy Haldane at 14:00. Then in the evening from the Fed we have Loretta Mester speaking at 18:30, followed by Patrick Harker at 19:20.