News

Euro holds steady ahead of ECB Policy Meeting

EUR

The Euro was almost unchanged against rivals as investors await the European Central Bank monetary policy meeting. The single currency weakened slightly yesterday amid growing chances of further monetary policy easing at today's meeting. During the last meeting, Christine Lagarde vowed to calibrate policy to support the economy, especially as the economic indicators worsened with the second outbreak. There are no expectations of an interest rate cut, but an expansion and extension of the asset purchases program. The EURUSD is trading near $1.2090.

USD

The dollar index which measures the greenback against a basket of major currencies inched higher to 91.20, testing the 200-hour exponential moving average, as stimulus talks stalled. It seems like the US policymakers are still not ready to compromise on a relief bill. On the other hand, the Brexit uncertainty and expected ECB policy easing supported the flow to the dollar.

Equities

Major US stock index futures retreated from their interim top on fading hopes over stimulus. The Senate Majority Leader Mitch McConnell stated that they are still looking for a way forward on fiscal aid. Investors are afraid that talks will stall again, delaying the needed support as the COVID19 outbreak continues significantly in the US. The Dow Jones Industrial Average futures dipped to 30017, the S&P500 futures declined to 3664, and Nasdaq futures plunged the most to 12302.

Metals

Gold prices tumbled as chances of reaching a deal over stimulus lessened, and the dollar rallied. The price of a gold ounce declined to $1825, the price of a silver ounce dropped to $23.60, and palladium futures tumbled to $2261.

Oil

Oil prices continued to trade in a tight range awaiting fresh drivers. The market is stabilizing following the OPEC+ decision on adding only 500 thousand barrels per day, neglecting the sharp increase in covid19 cases, and lower chances of fiscal stimulus. The US crude inventories rose by 15.189 million barrels as per the US Energy Information Administration, but the report didn't have a long-lasting effect on prices. This morning, the West Texas Intermediate crude January delivery traded near $45.60, and Brent Blend February delivery held steady below $49.

Major Economic Events

GMT Country Event Expectation Previous

12:45

EZ

 ECB Interest Rate Decision (Dec)

0.00%

0.00%

13:30

EZ

 ECB Press Conference  

-

-

13:30

US

 CPI (MoM) (Nov)

0.1%

0.2%

13:30

US

 Initial Jobless Claims

725.0

712

 

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