Dollar Dips, Gold Shines on Full Vaccine Approval, Reduction Expectations Diminish
Here’s what you need to know on Tuesday, August 24:
Markets remain bullish after the FDA fully approves Pfizer’s covid vaccine and Fed expectations decline. Concerns about Afghanistan and the virus are dismissed, causing the safe dollar to fall and gold to rise. Cryptocurrencies are off their peaks.
Arm shot: The United States Food & Drug Administration (FDA) has fully approved the Pfizer / BioNTech COVID-19 vaccine, allowing institutions and businesses more leeway to demand vaccination. This inoculation had only had an emergency authorization. Monday’s news sent stocks higher despite early reports of such a move.
No rush to thin: Investors have continued to respond to declining chances that the Federal Reserve will scale back its bond buying program. Fed hawk Robert Kaplan has shown himself ready to change perspective, and the bank’s decision to hold its Jackson Hole Symposium virtually implies that the Fed would not withdraw its stimulus when forced to cut. its operations due to the Delta variant.
The optimistic mood has lower the dollar, with currencies increasing their own issuance. EUR / USD is trading around 1.1750 despite a drop in the German Manufacturing Purchasing Managers Index. GBP / USD resumed the 1.37 line, ignoring the fall in UK services PMI. Both countries suffer from a high number of covid cases.
AUD / USD is greater than 0.72 and NZD / USD exceeds 0.69 on the greenback’s weakness, ignoring the prospect of longer lockdowns in both countries. USD / CAD fell to around 1.26 as the loonie took advantage of the rebound in oil prices. WTI jumped to $ 65 amid improving outlook.
Gold hit $ 1,800, benefiting from optimism and calm US Treasury yields. The price of the precious metal has finally crossed the limits.
New home sales in the United States and the Richmond Manufacturing Index stand out on an otherwise light day on the economic calendar and ahead of larger releases later in the week.
Investors also keep an eye out for G-7 virtual meeting focusing on Afghanistan. The United States is expected to leave on August 31, but the allies are urging an extension of the mission to help with the evacuation efforts. Staying longer could complicate the mission.
Crypto-currencies are off their highs with Bitcoin hovering below $ 50,000 and Ethereum cooling towards $ 3,300.