On Friday, the market is reporting that the US economy is stumbling as the dollar has retreated, which has allowed gold and other global currencies to improve their value. The week has been turbulent for many retail sales numbers as well.
In a sudden turn of events, the greenback has started retreating from its recent high. US economy had started seeing positive numbers after the treasury department announced that the Federal Reserve was doing well. Experts are speculating on this low a day after the dollar value increased. Many believe that it’s because the Feds have refused to infuse the market with the necessary stimulus. Even though the Feds expressed concern over the state of the US economy, they failed to give the market any new stimulus, which resulted in a significant decrease in the US dollar’s demand and stocks.
Gold Trades At $1,950 Showing Improvements After The US Economy Falters
The Consumer Sentiment Index presented by the University of Michigan showed a downtrend in US retail sales since August.
After the Feds decided against any new stimulus, Gold’s value has increased to $1,950. However, the Gold trade value is still lower than what it is used to. Experts believe that this precious metal’s value will fluctuate depending on whether there will be another round of stimulus to the US economy.
Congress is still deliberating on fiscal stimulus plans. Although all the parties and the White House believes that the country needs another round of stimulus, the delay is because the two parties cannot agree on a plan. However, a bipartisan caucus has proposed a bipartisan US economy stimulus plan of $1.5 trillion. Currently, there’s no news on whether this bipartisan stimulus plan will be approved or not.
USD/GBP Remains Volatile
As the cases of coronavirus are rising in many countries, several world leaders are speculating a second COVID-19 lockdown. As such, the UK, too, is discussing shutting down the country for a second time. The Bank of England did not change its rate, which was expected. However, the market was left surprised after they announced that they would be testing the negative rates’ effectiveness. The sterling dipped, but it improved after Brexit developments.
The President of the European Commission said that she believed Britain and the bloc can come to an understanding. Earlier, UK prime minister decided to compromise and such a deal that violates the EU Brexit accord.
Both the UK and Canada retail sales have been predicted to progress slowly.
The global pandemic has severely affected the world and the US economy. With the alarming rise of positive cases in France, Europe seems to be becoming a major hotspot again.
The OPEC+ has decided to not change the production target. Despite this, oil is doing well. Bitcoin, on the other hand, is currently trading at $11,000.