Forex news for New York trade on December 3, 2020:
- OPEC+ agrees to raise production by 500K bpd starting in January - report
- Brexit sticking point is on policing and enforcement
- US November ISM services index 55.9 vs 55.8 expected
- Pfizer cut vaccine rollout target due to supply chain problems - report
- US virus cases increase by nearly 200,000
- OPEC+ agrees to raise production by 500K bpd starting in January - report
- McConnell: I see 'a few hopeful signs' towards stimulus compromise
- US November final Markit services index 58.4 vs 57.5 expected
- US weekly initial jobless claims 712K vs 775K expected
- US November Challenger layoffs 65k vs 81k prior
Markets:
- Gold up $9 to $1840
- US 10-year yields down 2.3 bps to 0.91%
- WTI crude up 39 cents to $45.67
- S&P 500 down 2 points to 3666
- GBP leads, USD lags
It was another day and another dollar selloff in the FX market. Levels continue to fall like dominoes as the dollars to increasingly lower levels. It's not even a risk trade, it's constant dollar selling in all environments with only shallow dips.
The other set of stories was all around dealmaking with OPEC, Brexit and US stimulus all on the table. OPEC made a deal to bring back 500K bpd of production in Jan, Feb and March. That's more bearish than what was expected but there was hardly a hiccup in the crude market. The loonie responded with a strong day, leading the commodity currencies.
Cable broke its 2020 highs on positive Brexit talk early but couldn't get above 1.3500 in several tries. Later, a number of reports highlighted ongoing problems in a few areas and it sank back to 1.3450. It's holding in relatively well though, suggesting the market still thinks a deal is coming.
The US stimulus deal is further off and reading the signals continues to be tough. The market liked some positive murmurs earlier in the week but from here it's going to take some clearer signals of progress. Gold is reacting to it and that will be a spot to continue watching. It hasn't been able to give the dollar a lift but that could change if 1% breaks in 10s.
