ForexLive European FX news wrap: UK approves Pfizer vaccine; sterling falls on Brexit jitters
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Forex news from the European trading session – 2 December 2020
Headlines:
Markets:
- CHF leads, GBP lags on the day
- European equities mostly lower; E-minis down 0.3%
- US 10-year yields down 1.1 bps to 0.914%
- Gold up 0.2% to $1,818.40
- WTI down 0.6% to $44.30
- Bitcoin down 1.2% to $18,830
A big day in the battle against the coronavirus, as the UK approves Pfizer’s vaccine for use and the first 800,000 doses will start to come into effect from next week.
That failed to really lift the market mood though as equities kept more tepid with US futures sticking with slight losses throughout the session, and European indices also showed little poise as they sit lower on the day (only UK stocks higher).
Instead, it was Brexit headlines that mostly stole the show as the pound was brought lower as there is a great deal of angst surrounding the current situation.
As talks are still ongoing in London, any semblance of a deal hangs in the balance as both sides are still unable to compromise on the three key outstanding issues.
Barnier briefed EU envoys and reaffirmed that no-deal is still an option and France threatening to push for that option is keeping the pound lower in trading today.
Cable fell from 1.3440 to 1.3340 initially, holding near key near-term support before a subsequent fall to 1.3304 and is trading just above that currently.
Elsewhere, the dollar kept firmer throughout after some mild weakness early on as the selling in cable also bolstered flows into the greenback.
EUR/USD fell from 1.2088 to 1.2040 while USD/JPY pushed higher from 104.50 to 104.75.
Elsewhere, USD/CAD also recovered off the lows from 1.2916 to 1.2950 while NZD/USD was dragged back lower from 0.7084 to near session lows now of 0.7034.
The market is taking a breather after a hot start yesterday, which was a bit of a repeat of November trading. It’s still largely all about the risk mood but the pound and oil will also be key focal points this week as both Brexit and OPEC deals hang in the balance.