Forex Today: Biden's expected stimulus boosts markets, melts gold, Powell, jobless claims eyed


Here is what you need to know on Thursday, January 14:

Reports that Biden's is set to announce a $2 trillion package have been boosting markets and weighing on gold. Investors are shrugging off Trump's second impeachment and eyeing a speech from Jerome Powell, jobless claims, and coronavirus headlines. 

President-elect Joe Biden is set to introduce an aid package worth around $2 trillion, a significant top-up to the recent $900 billion relief approved by Congress. Stocks are on the rise in anticipation of a stronger economy and US bonds are sold off. The increase in yields is relatively moderate and the greenback is stable. Gold has dropped sharply in response to rising yields, falling to new weekly lows at $1,827. 

President Donald Trump was impeached for the second time in his term amid his role in the Capitol riots. Ten House Republicans voted with Democrats, but the Senate is unlikely to hold a trial before January 20, allowing Trump to conclude his term. Markets are focused on Biden's plans rather than the political drama.

Jerome Powell, Chairman of the Federal Reserve, speaks later in the day and will likely convey a message of stability regarding the Fed's bond-buying scheme. His colleagues have been talking about the possibility of tapering the scheme, somewhat boosting the dollar. 

US initial jobless claims are set to stabilize below the 800,000 level as the US economy continues struggling with covid.

See US Initial Jobless Claims Preview: Will filings indicate more layoffs?

Vaccine: Johnson and Johnson said that its one-shot immunization scheme is 90% efficient some 29 after the injection. The pharmaceutical giant's encouraging results are offset by manufacturing delays but may deploy later in the quarter. AstraZeneca said its two doses can be administered with a gap of 8-12 weeks. 

Europe: Germany reported another daily death record and the end to the lockdown is out of sight. The European Central Bank releases its meeting minutes on Thursday, and it may repeat President Christine Lagarde's message that uncertainty has receded. 

UK: Prime Minister Boris Johnson is under growing pressure to tighten restrictions once again as pressure on hospitals intensifies. Covid mortalities hit a record on Wednesday, but infections show tentative signs of falling. GBP/USD remains buoyed by Britain's accelerated vaccination campaign and by hawkish words from the Bank of England early in the week.

Chinese exports have increased in December, showing the strength of the world's second-largest economy. A World Trade Organization delegation has arrived in Wuhan to investigate the origins of COVID-19. 

US-China Relations and the Biden Administration: Trade war over but you can't go home again

Cryptocurrencies have resumed their gains after consolidating on lower ground. Bitcoin is trading above $37,000, Ethereum above $1,100 and XRP around $0.30. 

Five factors moving the US dollar in 2021 and not necessarily to the downside

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

EUR/USD rebounds, steadies above 1.0400

EUR/USD rebounds, steadies above 1.0400

EUR/USD has staged a rebound and reclaimed 1.0400 during the American trading hours on Friday with the US Dollar Index retreating from the multi-week high it set at above 105.60. Nevertheless, the pair remains on track to close the week in negative territory. 

EUR/USD News

GBP/USD climbs to 1.2050 area, looks to post weekly losses

GBP/USD climbs to 1.2050 area, looks to post weekly losses

GBP/USD reversed its direction and advanced to the 1.2050 area after having dropped to 1.1976 earlier in the day. The pair is still down more than 1% on the day with safe-haven flows dominating the financial markets following the disappointing PMI data from the US.

GBP/USD News

Gold rebounds above $1,800 as US yields fall sharply

Gold rebounds above $1,800 as US yields fall sharply

Gold has regained its traction and recovered above $1,800 after having slumped to a multi-month low below $1,790. Following the dismal PMI data from the US, the benchmark 10-year US Treasury bond yield is down more than 6% on the day, fueling XAU/USD's rebound.

Gold News

Why traders are rushing to exit positions on Cardano’s ADA price

Why traders are rushing to exit positions on Cardano’s ADA price

Cardano (ADA) price has had its performance review as the summer kicks off. ADA bulls are returning home with not-that-good a scorecard, and the underperformance could cut short holiday funding for the cryptocurrency.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!

BECOME PREMIUM

Forex MAJORS

Cryptocurrencies

Signatures