A light data calendar during Christmas week has not dampened enthusiasm for the British pound. The currency started off the week on the wrong foot but has easily recovered these losses and then some. Earlier in the day, GBP/USD rose to 1.3686, its highest level since May 2018
ncing low liquidity this week, they are vulnerable to volatility based on geopolitical events. One such development this week has been the approval in the UK of the Astra Zeneca vaccine for COVID-19. This has not only boosted the pound, but has also contributed to the global recovery trade and further U.S. dollar rotation. This vaccine is considered a game-changer in the battle against COVID, as it can be stored at room temperature, unlike the Pfizer (NYSE:PFE) vaccines which must be stored at subzero temperatures.
The U.S. dollar continues to look lost and has fallen 2.47% against sterling in December. Sell-offs of the currency have become an almost daily occurrence, and the near-term prognosis for the dollar is bleak. The U.S. is facing the grim reality of twin deficits (budget and trade), and things aren’t expected to get better anytime soon. The new $900-billion stimulus bill will add to the U.S. debt, and the incoming Biden administration is expected to add even more stimulus. The dollar’s woes have led to investors dumping their U.S. assets, and we can expect to see a continued global rotation of U.S. dollars into major and commodity currencies into the new yea
ncing low liquidity this week, they are vulnerable to volatility based on geopolitical events. One such development this week has been the approval in the UK of the Astra Zeneca vaccine for COVID-19. This has not only boosted the pound, but has also contributed to the global recovery trade and further U.S. dollar rotation. This vaccine is considered a game-changer in the battle against COVID, as it can be stored at room temperature, unlike the Pfizer (NYSE:PFE) vaccines which must be stored at subzero temperatures.
The U.S. dollar continues to look lost and has fallen 2.47% against sterling in December. Sell-offs of the currency have become an almost daily occurrence, and the near-term prognosis for the dollar is bleak. The U.S. is facing the grim reality of twin deficits (budget and trade), and things aren’t expected to get better anytime soon. The new $900-billion stimulus bill will add to the U.S. debt, and the incoming Biden administration is expected to add even more stimulus. The dollar’s woes have led to investors dumping their U.S. assets, and we can expect to see a continued global rotation of U.S. dollars into major and commodity currencies into the new yea
