Today has been a more typical “risk-on” session, with the Dollar down sharply and global equities up. Global risk appetite has been fuelled by news that the US Senate had this morning approved President Joe Biden’s $1.9 trn coronavirus stimulus package. It was a hung vote, with Republicans and
Democrats split 50-50, and Vice-President Kamala Harris cast the deciding vote in favour of the relief bill. It will now go to the House of Representatives where the Democratic Party has a material majority.
The Dollar DXY index is down 0.55% at time of writing, its biggest daily loss since 17th December. The S&P 500, which yesterday closed at a new record high, is on track to better yesterday’s closing level of 3,871.7. It is up for the fifth consecutive day in a row – for the first time since August – and up 4.7% since last Friday. Notably US equities have seemingly been unencumbered by the release today of tepid US labour market data for January. In particular the US economy created only 49,000 jobs.
The Australian and Kiwi Dollar have taken the lead, with the AUD/USD cross up nearly 1% since yesterday’s close. The GBP/EUR cross is down slightly today after its post Bank of England meeting surge yesterday but is still just below 1.14 and at its strongest level since May. The EU (and by
extension Euro) has been in the spotlight in recent days for its slow vaccination program relative to the United Kingdom’s and the European Commission President has had to backtrack on her initial stance.
