Forex Today: US stimulus bill signed, equities run

FXStreet Team FXStreet

Here is what you need to know on Tuesday, December 29:

US President Donald Trump signed the coronavirus-relief/government funding bill on Sunday. Optimism took over financial boards, and the dollar fell against its major rivals, as Wall Street reached fresh record highs.

Major pairs were confined to familiar levels. Trading was choppy amid diminished volumes. A shortened week includes no relevant macroeconomic releases.

The Sterling Pound was the weakest, as investors start to digest the Brexit deal, published over the weekend. The over 1,200 pages document leaves some major issues still unresolved, weighing on sterling. Regarding a level playing field, the UK is not aligned with EU laws, and the latter may impose tariffs that are still to be defined.

The EU’s 25 member states backed the post-Brexit deal clinched on Christmas Eve, to be “provisionally applied” at the end of the year. The treaty needs now to be approved by the UK parliament, which will discuss it on December 30.

Wall Street pulled off intraday highs, but still managed to close in the green. Commodities, on the other hand, came under selling pressure amid the dollar’s demand. Gold settled around $1,870 a troy ounce, while WTI ended the day just below $ 48.00 a barrel.

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FXStreet Team

FXStreet

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AUD/USD remains depressed near 0.6950 after RBA minutes

AUD/USD attracts follow-through selling during Tuesday’s Asian session, looking to extend the overnight rejection slide from 0.7000, or a two-week top, following the release of RBA meeting Minutes. The US Dollar retains a bullish undertone near its highest level since April 2025 as energy-driven inflation risks keep December Fed rate hike bets firmly on the table. Adding to this, geopolitical risks further underpin the safe-haven USD.

USD/JPY extends retreat below 158.50 as intervention risks loom

USD/JPY is dropping below 158.50 in the Asian session on Tuesday, snapping a two-day winning streak and pulling back from an over two-week top touched the previous day, despite Japan's soft PPI inflation print. Bulls turn cautious amid speculation that authorities will step in to prop up the Japanese Yen, which, in turn, weighs on the pair.

Gold: Bears struggle to breach below $4,150

Gold now gives away its initial gains and resumes its decline, revisiting the $4,160 region per troy ounce on Tuesday. The precious metal’s pullback comes despite the fresh downward trend in the Greenback in combination with a mixed performance of US Treasury yields across the board and easing tensions on the geopolitical front.

Bitcoin rebounds despite cautious sentiment

Bitcoin rebounds over 2%, trading above $83,500 on Tuesday, recovering the previous day’s losses. Persistent geopolitical tensions and mixed signals continue to weigh on risk appetite, keeping investors cautious despite BTC’s recovery.

US – Midterm update: Democratic lead holds three weeks before election

With three weeks until the US midterm election on 3 November, prediction markets are more or less unchanged. Polymarket continues to put the probability of a Democratic sweep at 60-65%. The House is seen as a fairly safe Democratic win, with a probability of around 90%.

Has Bitcoin really escaped the macro forces it was built to fight?

Over 17 years ago, Satoshi Nakamoto designed Bitcoin (BTC) on the back of a global financial crisis as an alternative to the global monetary system outside the control of central banks, governments and traditional intermediaries. This raises a key question: has Bitcoin really become independent of the macroeconomic forces it was built to challenge?