Forex Today: Dollar’s weakness keeps spreading, Brexit deal awaited

FXStreet Team FXStreet

Here is what you need to know on Wednesday, December 16:

The dollar found some market favor at the beginning of the day amid a risk-off mood but ended the day in the red against most major rivals.

The sentiment was sour amid fresh coronavirus-related lockdowns in the US and Europe, as e New York Mayor Bill de Blasio warned that the city needs to prepare for a full shutdown, as the number of hospitalizations keeps growing. Germany, the Netherlands, and London have announced tight restrictive measures.

Brexit tensions keep mounting. UK PM Boris Johnson’s spokesman said that the UK wants a post-Brexit deal but not “at any cost.” PM Johnson told his senior minister that the most likely outcome was a no-deal Brexit. The news feeds were flooded by rumors and speculation, but no official announcement has been made at the end of the day. Speculation that the EU and the UK are close to clinching a deal sent GBP/USD to the 1.3450 price zone.

The Canadian dollar was the best performer, with USD/CAD falling below 1.2700 a fresh multi-year low. Higher oil prices and Wall Street’s advance underpinned the commodity-linked currency.

The US Electoral College formally voted to elect Joe Biden on Monday, and Senate Majority Leader Mitch McConnell acknowledged Joe Biden as the president-elect.

The US Food and Drug Administration confirmed that the Moderna’s coronavirus vaccine has an overall efficacy of over 94%, and could grant it emergency use before the weekend. A group of experts is set to meet next Thursday to offer their recommendations.

Gold prices surged to fresh weekly highs above $1,850 a troy ounce, amid the broad dollar’s weakness. WTI settled at $47.50 a barrel.

Bitcoin Cash price gearing up for a potential pullback to $270 – Confluence Detector

Author

FXStreet Team

FXStreet

EUR/USD makes a U-turn, focus on 1.1900

EUR/USD’s recovery picks up further pace, prompting the pair to retarget the key 1.1900 barrier amid further loss of momentum in the US Dollar on Wednesday. Moving forward, investors are expected to remain focused on upcoming labour market figures and the always relevant US CPI prints on Thursday and Friday, respectively.

GBP/USD sticks to the bullish tone near 1.3660

GBP/USD maintains its solid performance on Wednesday, hovering around the 1.3660 zone as the Greenback surrenders its post-NFP bounce. Cable, in the meantime, should now shift its attention to key UK data due on Thursday, including preliminary GDP gauges.

Gold holds on to higher ground ahead of the next catalyst

Gold keeps the bid tone well in place on Wednesday, retargeting the $5,100 zone per troy ounce on the back of modest losses in the US Dollar and despite firm US Treasury yields across the curve. Moving forward, the yellow metal’s next test will come from the release of US CPI figures on Friday.