Daily Market Update 21/12/2021

Main Headlines:

The Omicron variant caused more than 70% of recent Covid-19 cases in the U.S., according to the CDC, highlighting its substantial increase in infectiousness compared with earlier versions of the virus. The CDC said Monday that Omicron had overtaken the Delta variant of the coronavirus in the U.S. and accounted for an estimated 73% of infections for the week ending Dec. 18. In many parts of the U.S., particularly in the densely populated North-East States such as New York, Maine and New Hampshire, Omicron now makes up more than 90% of cases, the CDC said. Infectious-disease experts have said they believe the true share is likely even higher than that.

UK public borrowing fell in November as the end of the job retention scheme helped to cut public spending, despite rising costs from the vaccination programme and higher debt interest payments. Public sector net borrowing was estimated to have been £17.4bn last month, £4.9bn less than in November 2020 when most of the country was under tight restrictions, according to data from the Office for National Statistics. However, this was higher than the £16bn forecast by economists polled by Reuters.

Markets

GBP

Sterling is well-bid against most major currencies in early morning trade. UK businesses have urged the PM for clarity on restrictions over Christmas. Hospitality and entertainment firms are calling for a clear decision from the government on whether to expect further Covid restrictions in England in the coming days. Boris Johnson did not announce any new measures on Monday, but said data was being reviewed “hour by hour”. Elsewhere, an independent watchdog will oversee the UK insolvency sector, ending decades of self-regulation, as part of a proposed government shake-up of the industry. The plans would streamline the regulation of 1,600 licensed insolvency practitioners in England, Scotland, and Wales by replacing the four professional bodies to which supervision is currently devolved.

EUR

The euro is lower against sterling and higher against the dollar overnight. The European Medicines Agency on Monday recommended the use of a new type of COVID-19 vaccine from Novavax, bringing to five the number of jabs that will become available in the EU. The agency’s medicines committee guided that the vaccine, named Nuvaxovid, can be used in adults aged 18 and over. In clinical trials earlier this year, the vaccine proved to be more than 90 percent effective in preventing COVID-19 cases and 100 percent effective in preventing moderate to severe disease. Elsewhere, Germany’s new Defence Minister Christine Lambrecht said that NATO allies were willing to discuss a raft of demands put forward by Russia, which has massed troops along the Ukrainian border, but would not allow Moscow to “dictate” to the alliance or its partners. Lambrecht’s comments came during a visit to German troops stationed in Lithuania as part of NATO’s forward operating presence.

USD

The dollar is weaker against most majors in early morning trade. Senator Joe Manchin’s opposition to the party’s $2 trillion healthcare, climate and education plan left Democrats grasping for a new path forward Monday, with Senate Majority Leader Chuck Schumer saying that the Senate would vote on the bill early next year despite the pivotal lawmaker not being on board. After broadcasting his opposition to the bill a day earlier, the West Virginia Democrat said Monday that lawmakers should start from square one to rebuild a potential package and criticized the White House for its handling of the talks. Mr. Manchin’s position effectively killed the bill in its current form and put President Biden’s economic agenda in jeopardy.

Ballinger & Co. Morning Report- 21st December 2021

Today’s Rates

GBP>EUR – 1.1718

GBP>USD – 1.3232

EUR>USD – 1.1297

GBP>CAD – 1.7128

GBP>AUD – 1.8588

GBP>SEK – 12.081

GBP>AED – 4.8603

GBP>HKD – 10.323

GBP>ZAR – 20.958

GBP>CHF – 1.2182

Today’s Calendar           

·      10:00 a.m.: ECB’s Kazimir speaks

·      12:00 p.m.: U.K. Dec. CBI retail sales

·      4:00 p.m.: Euro-area Dec. consumer confidence

·      API U.S. oil inventories

·       Italy’s parliament budget law debate

  Today’s Highlights

·       Forex Today: Majors fluctuate in familiar ranges as risk mood improves

·       EUR/USD: Daily recommendations on major

·       GBP/USD treads water above 1.3200 as Omicron risks UK lockdown

·       Japan upgrades economic view for first time in 17 months in December

 (https://frank-exchange.com/)

This document has been prepared solely for information and is not intended as an Inducement concerning the purchase or sale of any financial instrument. By its nature market analysis represents the personal view of the author and no warranty can be, or is, offered as to the accuracy of any such analysis, or that predictions provided in any such analysis will prove to be correct. Should you rely on any analysis, information or report provided as part of the Service it does so entirely at its own risk, and Frank eXchange Limited/Manor House Foreign eXchange Limited accepts no responsibility or liability for any loss or damage you may suffer as a result. Information and opinions have been obtained from sources believed to be reliable, but no representation is made as to their accuracy. No copy of this document can be taken without prior written permission.

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