Forex Today: Equities plunged on fears, currencies showed no signs of life
|Here is what you need to know on Tuesday, October 27:
It was a dull start to the week, with risk aversion prevailing the greenback seesawed between gains and losses, and major pairs held within familiar levels.
The dismal mood was triggered by resurgent coronavirus cases in the US and Europe, as the weather turns cooler, which led to new restrictive measures. Concerns about economic growth pushed equities sharply lower, with US indexes losing over 2.5% each at some point of the afternoon. Despite modest bounces, all the three major indexes closed in the red. Also, the lack of progress in a US stimulus package hurt sentiment.
EU’s chief negotiator Michel Barnier decided to extend his stay on London after weekend talks, and speculative interest understood it as progress in Brexit talks. Nevertheless, UK PM Boris Johnson’s spokesman said that there is “much work to be done” and that significant gaps remain in the most difficult areas.
The EUR/USD pair edged lower but held above 1.18. The GBP/USD pair also slid but retained the 1.3000 threshold. Commodity-linked currencies also ranged against the greenback, despite the sharp decline in equities.
Gold spent the day hovering just above $1,900.00 Oil remained under selling pressure with WTI settling around $38.50 a barrel.
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