IFX Market Report: Thursday 23rd December 2021

Sterling and Euro have been able to capitalize on a weaker Dollar as safe-haven currencies lost momentum on Wednesday due to “signs that the Omicron variant of COVID-19 might be less severe than feared”. London’s Imperial College published their latest research on the new variant yesterday and claimed that “the risk of needing to stay in hospital for patients with the Omicron variant of COVID-19 is 40-45% lower than for patients with the Delta variant”. This news has forced the US Dollar lower and given an uplift to ‘risk-on’ currencies such as the Pound. This morning, the Dollar Index (DXY) dropped to 96.018, its lowest since 17th December. Thus far, “the Dollar’s recent losses have been fairly broad-based; the euro has gained for the last four sessions, and the Australian dollar - often seen as proxy for risk appetite - is up 1.2% on the week”.

Cable was able to make impressive upside moves on Wednesday, reclaiming the 1.33 handle and finishing close to 1.3350 mark. GBPUSD started the day at 1.3268 and closed at 1.3344.

GBPEUR was also able to make gains yesterday, but upside was capped for the pair due to a stronger Euro. The pair opened at 1.1770 and closed at 1.1783.

After trading in a tight range of late, EURUSD relished in the new market sentiment, climbing above 1.13 and holding that position beyond the close. The pair opened the day at 1.1272 and finished at 1.1324.

On the data front, it’s another important afternoon for the US. At 13:30 Novembers Core PCE Price Index YoY, PCE Price Index YoY, and Durable Goods MoM will all be released. At the same time, the US will also publish its weekly Labour report, consisting of Continuing Jobless Claims, Initial Jobless Claims, and Jobless Claims 4-week Average. Then at 15:00, Final Michigan Consumer Sentiment for December will be released, forecasted at 70.4 with a previous of 67.4.

Older posts
Newer posts