As Brexit talks develop and newer things come to light, we saw a dip towards the end of last week. With the US elections with a majority Biden vote, who has showed dislike to the way Brexit negotiations are going due to Biden’s Irish heritage, expected to likely not to go in the UK's favour. Previously Trump said he would put the UK at “the top of the list” for a trade deal post Brexit. Biden has now put in his two pence and stated that if we go down the route of a hard-Irish boarder then he isn’t willing to agree or even discuss a trade deal with the UK.
The highest levels last week was 1.285 on the GBP/EUR and 1.331 on the GBP/USD. Which has come down to 1.115 and 1.322 respectively.
Boris Johnson has gone into self isolation with the “track and trace” scheme notifying him that he as recently been in contact with someone with Covid. So, the PM will be running the country remotely, setting an example by following the rules and guidance put in place.
Dominic Cummings’ departure from number 10 has shaken up how things are expected to go, with his previous “Pro-Brexit” stance leaving very few to continue talks. He is expected to have fully finalised his leave by Christmas 2020. This will leave Mr Gove almost alone as Boris is now in isolation too. But Gove remains confident stating that the negotiation team is “on course and ready to take advantage of all the opportunities” and will “continue to battle hard for the whole of the UK”.
The Euro has seen some of its own gains last week against the Dollar seeing its high for the week being 1.192 but slowly trickling down to its current level of 1.185.
Covid is still rising in Europe with a total of nearly 2 million cases seen in France and 1.5 million in Spain. But with hopes of a 90% vaccine being distributed soon this is likely to be a thing of the past.
For the first time since the elections started Trump has acknowledged that Biden “May” have won but isn’t giving up on investigating any signs of election fraud. This is likely to be the big driver behind the dollars drops last week as any evidence found is likely to hold the US in limbo for some time. As the usual safe-haven currency investors have searched for alternatives such as the Euro, which is why we can see climbs on the other side.
Biden has further concreted his win in by solidifying the state of Georgia giving him a total of 306 votes, compared to trumps expected 232 votes. This exactly mirrors Trumps previous win against Hillary Clinton which was 306 votes in his favour.
New release coming out of the US this week is, Core retail sales/ retail sales month of month on Tuesday.
Lots of news coming out of Australia over the next coming week with RBA (Reserve Bank of Australia) Governor Philip Lowe talking today followed by a Monetary Policy meeting tomorrow. Tomorrow Lowe will speak shortly after the meeting has conceded.
Thursday, we have Australian employment change and the unemployment rate, with the effects of Covid over the last year this is likely to be a driver of the market.
Some news release coming from Canada which is CPI month on month and non-farm employment change later in the week, Wednesday and Thursday.
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