Dollar pushes back

Good morning,

Over the course of trading yesterday, global stock markets took a collective step back as risk sentiment decreased off the back of the news that the $1.9tn Biden stimulus bill may be negotiated lower in Congress. The ‘super-majority’ (a holding of a majority in the House, Senate and office of President in the USA) that the Democrats enjoy was thought enough to push through the bill without major changes; however, the admission that wider changes may be made sent risk currencies such as the pound off for the afternoon.

With that of course did come a boost for the dollar, as goes the usual equation of risk off equals dollar up, with market eyes now firmly on the next move from the Federal Bank on Wednesday. The Fed isn’t expected to move from its commitment to printing flurries of new dollars to prop up the Covid-battered economy; any changes from that sentiment at the meeting could have long lasting impacts on dollar pairs and global risk sentiment.

Have a great day.

Joshua Haden-Jones, Senior Relationship Manager.

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