Yesterday, the governor of the Bank of Canada, Macklem, said that the central bank rates will remain low for a very long time. He said that the quantitative easing program will be proceeded until the economy reaches its macro targets. It is expected that the Canadian economy will reach 4% in 2021 and 2022. It’s also emphasized that the economy is operating below its potential output. Judging from his rhetoric, we can conclude that the economy is recovering from the recession very slowly, which in turn limits the capital flow of investors into the country.
On Thursday, the UK treasury secretary Rishi Sunak said that he is confident and hopes that a Brexit trade deal with the European Union can be completed and its form is clear. Sunak said that a lot of work is underway and he thinks that with constructive relations and goodwill from all sides, they will sign an agreement. He also announced that everything that Britain is asking for, the European Union has already signed with other countries. We recommend traders to follow the progress of this issue upon signing the agreement, as this news may strongly affect the price of EUR and GBP.
JPMorgan analysts expect much bigger earnings growth on the US stocks. The SP500 is expected to trade at 4,500 by the end of 2021. Expectations of the decrease of many key risks (eg, the US elections, pandemic and vaccine news, etc.) give the green light to more positive opportunities". Regardless of the fact that there has been some upward pressure on interest rates, the central bank policy is still adaptive and remains the main supporting element for most equities.
JPM is wary of rising yields, saying that the yield of ten-year-old USTs by 1,5% would make them less comfortable for US stocks.
On Friday, WTI crude oil is declining amid concerns about market overstocking and doubts concerning the coronavirus vaccine. Correction of WTI oil is expected to the level of 43.50.
Yesterday, the American market was closed due to the weekend in the US.
The dollar index maintains a declined dynamic and dropped to 91.95.
The 10-year government bonds yield remains stable at 0.85%.
It is worth paying attention that there is no important news today. It's a day off in the US. Due to the low volatility in the market, we recommend traders to stick to conservative trading today, as well as fix positions at the nearest levels.
- – Thanksgiving Day in the US.
by 2020.11.27, We advise you to get acquainted with the daily forecasts for the major currency pairs.
This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.Open Account