Compass Global Markets' Blog

Market Update - 21st October 2020 - All Eyes On Huge U.S Stimulus Bill

Posted by Patrick Downes on October 21, 2020 at 9:06 AM

Please note that the commentary below is factual information provided to a group of readers as a web blog, and where an opinion is expressed by the author, it is GENERAL ADVICE only.

Nancy Pelosi Stimulus Package:

Focus shifts to the U.S this week where the market is hoping to see a huge stimulus package agreed on between Nancy Pelosi/House Democrats and the Trump Administration. The House of Reps led by the Democrats have already passed $2.2 trillion in spending, but the bill is stuck with Mitch McConnell and Senate Republicans who are holding up the stimulus package for political reasons. Negotiation's are ongoing and it's understood that Republicans have suggested $1.9 trillion as a number they'd support. Should Dems agree the package could become law as soon as this weekend and it would provide a huge shot in the arm for the ailing U.S economy that has been ravaged by Covid. The bill would likely also spur stock markets and risk assets such as the Aussie Dollar.

AUD Creeping Lower: 

The Aussie Dollar fell with U.S equities yesterday and is off around half a percent across the board since my last morning report on Monday. As suggested above U.S stimulus negotiations are the biggest catalyst for the Aussie Dollar this week and markets more broadly, as such their isn't a great deal to talk about.

UK CPI is due out tonight, followed by a speech from ECB President Lagarde.

The local stock market had a bad day yesterday, but a positive finish on Wall Street overnight sets us up for a better day today.

AUD EXCHANGE RATES:

AUD/USD – 0.7010

AUD/GBP – 0.5413

AUD/EUR – 0.5930

AUD/NZD – 1.0683

AUD/JPY – 74.029

OTHER MARKETS:

All Ords (XAO) – 6,396

Gold – A$2,706/oz

Silver –  A$35.01/oz

Oil – US$41.23 barrel

DATA RELEASES TODAY:

GBP - UK CPI due at 5:00pm

EUR – ECB President Lagarde Speaks at 6:30pm

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Patrick Downes

Senior Corporate FX Dealer

Phone Patrick - 0431 278 632 

  Email Patrick: patrick@compassmarkets.com

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 DISCLOSURE AND DISCLAIMER - GENERAL ADVICE WARNING
The information provided in this report has been prepared without taking into account your particular objectives, financial situation or needs. You should consider whether our products are appropriate for you and read the FSG and PDS which are available on this website.
This report and must not be copied, either in whole or in part, or distributed to any other person.
All references to prices, amounts and currency are in Australian dollars unless otherwise noted.
This report is provided for Australian residents only and is not intended for use by residents of any other country.

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