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Vaccine Hopes and Retail Sales Boost Forex Market

  • US Retail Sales Beat Expectations
  • Euro Rises on Positive Market Mood
  • Pound also Rises as PM Prepares for No Deal

The opening bell on Wall Street brought a strong response from the market today. The Dow Jones traded up more than 300 points amid positive market sentiment. This was buoyed by better than expected retail sales data from the US. The knock-on impact of this positive data and sentiment has been felt in the global forex market. Both the Euro and Sterling moved in the right direction on the news.

Retail Sales Jump Helps Broadly Boost Markets

Those in forex trading got a pleasant surprise today as retail sales data from the US for September easily outstripped analyst expectations. The monthly figure clocked in at 1.9% higher. This was much greater than the 0.7% which had been expected and has given a strong footing for the markets on which to end the week.

Not only those trading in forex greeted the news with positivity. As the numbers from major indices on Wall Street show that these all pushed higher to start the day. This snaps what had been a three-day run of negative opens for the Dow Jones. The hope will be that this confidence can extend to further boost the economy in a period where there seems no letup in COVID-19 news and cases.

Euro Strengthens Despite Coronavirus Struggles

With multiple countries and some of the major economies around Europe struggling with an increasing number of COVID-19 cases, it seems a strange time to see the Euro returning to strength. This bounce back though comes not only amid a move away from the Dollar thanks to the positive retail sales data, but also due to some improved hopes on a vaccine.

This renewed hope comes in the shape of Pfizer who appear to have pointed to the first time when a vaccine could be available. This gave the markets some positivity although the company say they will not seek approval until after the US election next month. In the meantime, governments across Europe are trying desperately to avoid a return to full-scale lockdowns and the economic turmoil that is sure to accompany them.

Boost for GBP Despite No Deal Probability

It has also been quite some time since forex brokers reported a positive move for the Pound. That changes today as the GBP too has been a beneficiary of the improved, risk-on market mood stemming from the US retail sales data.

With all the positivity those numbers bring, pushing Sterling back above $1.29 there has also been tough news for the wider British economy regarding the ongoing Brexit trade saga. Prime Minister Boris Johnson has threatened to walk away from negotiations on a deal with the EU. This comes as little substantive progress is being made. Johnson warned businesses to get ready for the prospect of no deal. Such a disruptive exit is projected to cost the British economy around $25 billion next year at a time it can ill-afford.


Read More: Vaccine Hopes and Retail Sales Boost Forex Market

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