Forex Today: Sentiment improved, the dollar fell

Here is what you need to know on Thursday, September 10:

 The dollar retained its strength throughout the first half of the day but ended the day with losses against most major rivals. The catalyst was an ECB related headline.

Bloomberg reported that some ECB policymakers have become more confident in their forecasts for the region’s economic recovery, potentially reducing the need for more monetary stimulus this year, according to people familiar with the matter. EUR/USD jumped to 1.1820 from a fresh multi-week low of 1.1752.

The UK introduced in Parliament an Internal Market Bill, meant to protect jobs in the kingdom after the transition period ends next December. The bill sounded all the alarms, as it may impact the UK’s relationship with the EU, given that it could re-write parts of the Brexit Withdrawal Agreement, particularly related to the Northern Ireland Protocol. European Commission President Ursula von der Leyen said that “breaching the Withdrawal Agreement would break international law and undermine trust.” GBP/USD collapsed to a one-month low of 1.2884, later recovering towards the 1.30 price zone.

The Bank of Canada had a monetary policy meeting and, as was widely expected, left interest rates unchanged at 0.25%. The bank also continued with its quantitative easing program, with large-scale asset purchases of at least $5 billion per week of Government of Canadian bonds.

Gold benefited the most from the intraday dollar’s weakness and despite a better market mood, surging to $1,950 a troy ounce, staying around the level at the end of the day. Crude oil prices were also able to recover some ground, but gains were modest. WTI settled at $38 a barrel.

The sentiment remained upbeat on market talks suggesting that TikTok's parent company is discussing options with the Trump administration to avoid a full sale of the app's US operations.

Coronavirus - Oxford vaccine.  AstraZeneca y Oxford announced a pause in trials amid adverse effects in a UK participant. The latest news on the issue suggests that such patient will shortly leave the hospital, and that trials may resume in a week. Meanwhile, the number of new cases continues to decrease in the US, but India reported a record of over 95K new cases in one day. The outbreak is also spreading in Latin America.