(25 September 2020)DAILY MARKET BRIEF 2:USD Retreats from 2-Month Peak
In the commodity market, oil prices have recovered some of their recent losses but are set to end the week lower amid worries about weak demand caused by a resurgence of COVID infections. So far, WTI and Brent have gained about 0.10% each to trade above $40 and $42, respectively. Both brands are heading for a monthly drop, which will be the first decline in six months for Brent. The current recovery is not expected to last, as Libya is restarting its exports while the economic recovery in the US is losing steam.
Gold is declining in early trading on Friday and is set to end the week lower as investors turned their attention to stocks. The metal is down 0.23% to $1,872 per ounce.
In FX, the US dollar has retreated from two-month highs amid renewed hopes of another stimulus package in the US. The USD Index is down 0.03% to 94.370. Despite that, EUR/USD is down 0.03% to 1.1669 as the European currency continues to weaken amid a rapid increase in COVID infections on the continent.
The British pound has gained in pair with both the greenback and the euro, as UK finance minister Rishi Sunak unveiled a new job protection scheme after the current one expires in October. Still, the GBP increase is capped by the surging number of coronavirus cases.
Chinese sovereign bonds will be included in the FTSE Russell’s World Government Bond Index again after being rejected a year ago. The news has supported China’s Yuan, which has been Asia’s best performing currency this quarter.
