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Friday, November 27, 2020

US Dollar Gains Amidst Confusion Over Stimulus Package and Brexit

The coronavirus pandemic has been impacting several sectors of the world and its economy. Currently, change is the only constant. Here’s a sum-up of all the significant events that happened today starting from US dollars, stimulus package to Brexit. 

US Dollar Value

Although the stimulus package is still a mystery and the Brexit talks present a potential breakdown, the US dollar has been able to retain a high value and has been in the book of gains.

Stimulus Package

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President Donald Trump has appealed for a stimulus package worth more than $1.8 trillion, the funding offered by the Congress. The House Democrats have urged for funding of $2.2 trillion for the stimulus package whereas the Republicans have urged for a $500 billion funding. 

Brexit 

UK Prime Minister Boris Johnson is ready to declare whether discussions will be continued or cut off regarding future relations. Meanwhile, GBP and US Dollar is facing a knock-out.

Leaders of the EU have decided to hold discussions with the UK. But, the EU abstained from expressing any wish to intensify the talks. Meanwhile, it is expected that Brussels will be moved to fisheries and state aid from London. David Frost, the chief negotiator of Britain has exhibited disappointment. However, if discussions are continued by Johnson, the value of the pound is expected to rise. 

Coronavirus in Eurozone

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The Eurozone has been witnessing a spike in coronavirus for which several countries have adopted new measures to control the spread. Health Minister of Germany, Jens Spahn commented that the contract tracing capacity of the country will soon be exhausted. Several cities along with Paris may have to face a night curfew to tackle the pandemic. The sudden surge is impacting the euro as well as global markets. 

US Presidential elections

As the 3rd November elections knock on the door, the US dollar value is increasing and the stock market is facing a run-down. Joe Biden, the former vice-president has been maintaining his lead in national and opinion polls against Donald Trump. The contestants of the election were seen debating in a televised town hall event with little or no effect. 

By approving a high-valued stimulus package, as preferred by investors, Donald Trump will increase its winning chances considerably. However, the competition for the upper house is not a cakewalk and the markets are fearful about stricter rules and higher taxes. 

US retail 

After August’s data failed to provide an estimate, the sales figure of US retail has seen a rise in September. The last release made way for discussions on Capitol Hill, but the disrupted timetable indicates a high chance of a no-deal. However, for the economy of the US, consumption is the main criteria. 

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