A French mandate to require masks indoor has helped lift the CAC today, although rising cases bring fears of further nationwide lockdowns. While the US enjoy the thanksgiving holiday, the dollar is on the rise in response to yesterday’s FOMC minutes.

  • European markets enjoy positive day in absence of US volatility
  • CAC outperformance highlight support for latest restrictions
  • FOMC minutes signal potential for swifter tightening phase

European markets have enjoyed a relatively upbeat day today, with the lack of US involvement reducing volatility into the close. While rising Covid cases remain a key concern for mainland European economies, we have seen the likes of the DAX and CAC both gain ground. Just as many countries struggle to keep a lid on Covid cases, a new strain has emerged in South Africa to bring another potential concern for investors down the line. European Commission president Von der Leyen implored nations to step up vaccination efforts in the face of rising cases, with France the latest country to step up restrictions in a bid reduce the spread of the virus. While the French move to make mask wearing mandatory at indoor venues does highlight the risk posed by rising cases, the outperformance of the CAC provides a vote of confidence in a policy that many hope will help to stave off a wider lockdown. 

Yesterday’s FOMC minutes provided the basis for some monetary policy risk going forward, with a number of members citing elevated inflation levels as grounds for a swifter tightening phase. With traders weighing up the consequences of a swift withdrawal of monetary accommodation at the Fed, the dollar has once again taken centre stage on the FX front. With the core PCE inflation and initial jobless claims figures both reaching levels not seen in decades, it should come as no surprise to see the Fed starting to consider whether an asset purchase scheme is actually necessary right now.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

Feed news

Latest Forex Analysis

Latest Forex Analysis

Editors’ Picks

EUR/USD retreats below 1.1300 area as NFP-inspired dollar weakness fades

EUR/USD jumped to a daily high of 1.1333 with the initial market reaction to the disappointing November Nonfarm Payrolls data but quickly returned below 1.1300. Rising US Treasury bond yields seem to be helping the dollar stay resilient against its major rivals. 


GBP/USDdrops to 1.3250 area as dollar regains strength

GBP/USD spiked above 1.3300 in the early American session with the initial market reaction to the gloomy US November jobs report. However, the greenback regathered strength on hawkish Fed commentary and forced the pair to turn south.


Gold struggles to capitalize on weak NFP data, holds near $1,770

Gold spiked to a daily high near $1,780 with the initial market reaction to the disappointing Nonfarm Payrolls data from the US but seems to be having a difficult time preserving its bullish momentum with the 10-year US T-bond yield staying resilient.

Gold News

The bull and the bear case for BTC

Bitcoin price saw a bullish impulse that faced massive headwinds before it tagged a crucial psychological barrier. Bitcoin is likely to experience massive volatility as the situation resolves over time. 

Read more

Cyber Monday 2021 Discounts!

Glued to your trading screen on Cyber Monday? Upgrade your skills by signing up for FXStreet’s Premium service, offered at a discount of up to 50%. Fellow traders have already taken advantage of Black Friday profits. What about you? 

Subscribe now!