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Running cool

Today’s news headlines:

‘Jay Powell says ‘we have not won this yet’, as Fed holds rates steady’. Fed policymakers held interest rates close to zero and maintained the Central Bank’s rate of asset purchases, as Jerome Powell warned of a slowdown in the pace of the US recovery. In repetition of recent guidance, the Fed said that it will keep interest rates at current levels, until the economy reaches full employment and inflation is set to exceed 2% for considerable time. The Central Bank’s relatively recent shift towards tolerating higher levels of inflation underscores their commitment to achieving longer-term goals for US economic growth. (Financial Times)

‘EU demands UK Covid vaccines from AstraZeneca to make up shortfall’. The UK and EU might be set for their first post-Brexit political showdown after the EU said they are entitled to take vaccines produced from UK factories to make up a shortfall in supplies. Meanwhile, Boris Johnson’s government believe they have a watertight deal–which predates the EU deal by three months–with AstraZeneca to receive 100m doses of their vaccine. The UK wants to avoid turning the issue into one of ‘vaccine nationalism’, but the EU’s health commissioner said AstraZeneca must fulfil its contractual, societal and moral obligations. (Financial Times)

Today's events, rates, and data 

  • The US Dollar gained yesterday and overnight after Wall Street suffered its biggest sell-off of the year, as some hedge funds slashed their stock exposure at the fastest rate in more than six years. Overnight, the Euro and Pound suffered around 0.15% from the Greenback’s strength, although a warning on interest rates from the ECB could add some further selling pressure for the common currency.

Today's events

US Advance GDP: 1.30pm
US Advance GDP Price Index: 1.30pm
US Weekly Jobless Claims: 1.30pm
US CB Leading Index: 3.00pm

Interbank rates

GBP/USD: 1.3660
GBP/EUR: 1.1290
EUR/USD: 1.2095
USD/CAD: 1.2840