This Wednesday, the euro strengthened towards the region of 1.19, whileinvestors focus on the prospects for a strong economic recovery despite theuncertainties regarding the increase in the numbers of infected with covid-19 and slow pace vaccinations.
In turn, the DXY index was little changed compared to the previous session, nextfrom its lowest point in almost two weeks at 92.3, after the risk appetiteimproved with the IMF (International Monetary Fund) increasing expectations ofglobal growth in 2021 from 5.2% to 6.0%, citing additional fiscal aid. ToAt the same time, treasury yields continued to contract, well below the maximumof 14 months reached last month. Anyway, the fundamentals for the dollarremain strong, which gives room for further appreciation of the currency.
Consolidated at around USD 1740 an ounce, gold remains close to its pointhighest in more than two weeks reached in the previous session, supported by the dollar moreweak. Investors await the minutes of the FOMC meeting to be released today,after the Federal Reserve signaled it would keep interest rates to a minimumrecords until 2023, despite optimistic economic prospects for the US.
After the record highs reached on Monday, the North American indiceswere little changed today, while investors await the minutes of the meeting of theFOMC. Recent US economic data indicates a strong economic recovery,with payroll having its biggest growth in 7 months, ISM Services PMI reachingrecord high and new job openings reaching a two-year high.
In Europe, the indices reversed recent gains to close down, with the DAX 30retreating from its record high, while vaccination rates continue at a steady pacemuch slower than in the USA and the UK, at the same time as the continent European fights against a third wave. Another obstacle that arose in the campaign tovaccination was with the announcement of the European drug regulator of a possiblelink between the AstraZeneca vaccine and rare blood clotting problems inadults who received the vaccine. In addition, the Joint Vaccination andBritain’s immunization recommended not to use the Oxford / AstraZeneca vaccine tounder 30 years old. On the positive side, France will start producing the covid-19 vaccinesfrom Pfizer / BioNTech and Moderna for launch in the EU.
The US trade deficit increased for the second month to USD 71.1 billion inFebruary 2021, of USD 67.8 billion revised in the previous month, slightly above themarket expectations of a deficit of USD 70.5 billion. It is the biggest trade deficit everregistered, as imports fell less than exports, in another sign ofthat the American economy recovers faster than its trading partnersafter the pandemic. The goods deficit increased by USD 2.8 billion to USD 88 billion andthe services surplus decreased by USD 0.5 billion to USD 16.9 billion. Atexports fell 2.6% to USD 187.3 billion, mainly due to machineryindustrial, civil aircraft, semiconductors, food and beverage, automobiles and services travel. Imports fell by 0.7% to USD 258.3 billion, due topassenger cars and pharmaceutical preparations. The goods deficit increasedwith China (to USD 30.3 billion) and Canada (to USD 4 billion), but decreased withMexico (to USD 6.8 billion)
