The US dollar had been negatively affected by the news of the coronavirus vaccine. On the other hand, the Pound rose higher at the beginning of the session on 24th November. Right after the news broke that AstraZeneca has announced their COVID-19 vaccine has shown the efficacy of 90%, the currencies started fluctuating on the stock market.
Immediately after the news, the Pound witnessed their highest in 11 weeks for their US dollar exchange rate. The government of the UK has already ordered coronavirus vaccine doses of about 100 million and is planning to roll them out to the citizens as soon as possible.
Although the PMIs of the UK stated that the activity of their service sectors was contracted in the month of November, Sterling has managed to hold on to their gains. In fact, both have surpassed expectations as their manufacturing has shown to have a strong growth during the last month.
Along with this positive news, Brexit is being optimistic and supporting the gains of Sterling along with Taoiseach Michael Martin, the Irish, commenting on the details of the Brexit deal that might be cleared within the weekend.
The predictions of the future show that the headlines of Brexit may extend the gains of the Pound to the US dollar today in case the optimism is sustained that the deal between the UK and EU might be locked and agreed upon.
Although the Euro has been struggling since yesterday, things might turn around.
US Dollar Risks & Struggles
US dollar trades have recently lost all their ground as of 23rd November, Monday. The US dollar went through a sharp decline towards the beginning of the day due to the wave of a trade risk-on following the positive and hopeful news of the COVID-19 vaccine was announced.
The exchange rates of the US dollar have managed to regain a few of their losses in the latter part of the day on Monday. Nonetheless, this sudden aggressive growth was due to the development of manufacturing as well as service PMIs.
Despite the risk-on trend in the trade of the US dollar, it seems that it has made a return in this morning’s session. This comeback is due to the fact that Donald Trump, after a long period of denial, has ultimately accepted and formally announced the transition for Joe Biden, the President-elect, to take-over. This announcement might also lead to a drop in the trend of ‘Greenback’ today.
The Canadian dollar to the US dollar has some positive footing due to the rising prices of oil and the increased global demand following the news of the vaccines.
The Australian dollar to the US dollar has also exponentially increased overnight owing to the positive outcome of the vaccine trial.
The New Zealand dollar to the US dollar has also rapidly surged due to the announcement of their Reserve Bank for the consideration of house pricing in the mandate.