The U.S. dollar was volatile a while ago in the market. However, the currency is likely to stabilize in early European trading on Tuesday. It is because market participants are likely to be cautious ahead of the first US presidential debate.
The important debate will take place amid the development of a U.S. stimulus bill underway. Of course, this news grabs the attention of many market participants in the world. You know that USD is one of the major currencies there.
According to the data, the Dollar Index, which tracks the greenback against six other currencies, was down as much as 0.1% at 94.233. The figure comes after retreating from a two-month high of 94.745 reached last week. How's it going?
Other Pair Developments
On the other hand, the EUR/USD pair rose by 0.1% to 1.1681. Meanwhile, other currencies such as USD/JPY rose as much as 0.1% to 105.64. If noted the decline or increase in this figure can still be said to be in a stable state.
Nancy Pelosi, the U.S. House Speaker of the House of Representatives, said they had prepared a bill for a further Covid-19 relief stimulus package. This stimulus will be worth US$ 2.2 trillion. But he did not specify when the vote would take place.
All eyes will turn on Tuesday night local time to the moment of the first US presidential election debate. The moment was held between Democrat Joe Biden and Donald Trump. Donald Trump is for sure a representative of the Republican Party.
Democratic Victory and Its Impact on the USD
This is what analysts at Nordea wrote, in a research note. A Democratic victory would probably hit the USD and support the European assets. The race is arguably getting closer and even closers than some polls which are made lately.
If a Biden victory is the most likely outcome, such a scenario is far from certain. It is what Nordea also conveys. Markets are also waiting for a large number of economic data releases to gauge the health of the world's largest economy.
This includes Tuesday's consumer confidence figures. More importantly, however, is the jobs report on Friday. This time is actually the last period before the day of the presidential election will be held in America. Many people will get prepare.
GBP/USD is Still on the Rise
Elsewhere, GBP/USD rose 0.3% to 1.2864. This figure reached its highest achievement in a week. It follows a promising vote during the final round of scheduled Brexit trade discussions. This is a positive signal hoped by several market participants.
The Times reports that EU negotiators have signaled a willingness to start working on drafting detailed legal texts. In addition, British negotiators are also rumored to have agreed to present detailed proposals for fishing quotas. It will also be done in terms of state aid.
While the EU and UK say a post-Brexit agreement is still a long way off, European Commission chief Ursula von der Leyen said such a deal was still possible. If this agreement is realized someday, it will be better for the people.
Various Possibilities Still to be Thought Through
He now estimates the risk of a no-deal outcome of 50%. Therefore, Ursula sees that GBP neutral positions showing a signal of satisfaction highlighting the risk of a decline that cannot be ignored for sterling. It was conveyed by Francesco Pesole.
He is an analyst at ING. Elsewhere, Bank of England Deputy Governor Dave Ramsden rejected the idea that the central bank was committed to negative interest rates. He has a reason for this. You can predict that it is about the interest rate.
According to him, it is still very likely to see an effective lower limit on the 0.1% of the Bank's current Interest Rate. For information, here's what Ramsden said in an interview with the Association of Professional Economists of England posted online.
