Euro stood at an 18-month high and silver soared so far this Wednesday, as economic recovery hopes drove bets on rebounding world demand and a falling U.S. dollar.
EUR/USD surged to $1.1547, its best since January 2019 amid better market mood, while GBP/USD is trading around 1.27, off the highs seen earlier. USD/JPY pair was up 0.05% to 106.85, off the lows.
The dollar was down as investors retreated from the safe haven asset as the U.S. is struggling to reach a consensus on further stimulus measures. Tuesday saw the U.S. Congress continuing discussions to extend unemployment benefits, due to expire at the end of July, and provide more funding to schools. Meanwhile, Europe’s leaders reached agreement on a EUR750 billion stimulus package at the EU Summit after over four days of negotiations.
Gold prices tick up to nine-year highs on Wednesday morning, amid broad dollar weakness. Silver also has been on a winning streak, gaining in nine of the past 10 weeks to culminate in its rise to above $21 per ounce from 11-year lows under $12 hit in March.
Oil prices remain rangebound but hung on to most of their overnight gains. Brent futures slipped 0.5% to $44.12 per barrel and U.S. crude fell 0.5% to $41.70 a barrel as focus now shifts to EIA inventories data.
There isn’t any major market-moving economic data due for release from the UK or the Eurozone, therefore risk will act as an exclusive driver of the market’s momentum in the session ahead.
Later during the early North American session, the release of Existing Home Sales data from the US might fail to provide any meaningful impetus as the key focus will remain on developments surrounding the US stimulus package.