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Daily updates on foreign exchange news

Novox 12.30 Reference of Fx market

GBP/USD BENEFITING FROM WEAK USD, 1.36 IN SIGHT

GBP/USD remains well placed to move back to the highs around 1.3620 touched on December 17 and again on Christmas Eve. Like other ‘risk-on’ currencies such as EUR and AUD, it is benefiting from a weak US Dollar as renewed market optimism sends traders out of safe-havens into alternatives; a move also benefiting crude oil.

GBP/USD PRICE CHART, ONE HOUR TIMEFRAME (DECEMBER 17-30, 2020)



Behind the current market optimism lie hopes that the world’s central banks will continue to pump liquidity into the banking system, hopes that the roll-out of coronavirus vaccines will lead to an economic recovery in 2021 and approval Wednesday of the AstraZeneca/Oxford University vaccine for use in the UK. That’s despite the blocking by US Senate majority leader Mitch McConnell of a vote on virus relief checks and the spread of Covid-19 variants.

MPS TO APPROVE EU-UK TRADE DEAL

Adding to the positive tone in the UK, members of the British Parliament are about to approve the EU-UK trade deal. There was also positive UK economic news Wednesday, with the Nationwide house price index showing that annual house price growth rose to a six-year high of 7.3% in December.

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