Forex Today: Markets advance on stimulus hopes, vaccine optimism outweighs virus strain concerns

Here is what you need to know on Monday, January 25:

Markets are on the rise as the Biden administration pushes for stimulus and ahead of the Fed decision. The dollar is on the back foot while oil is higher and gold is stable. 

President Joe Biden is facing some bipartisan pushback for his $1.9 trillion fiscal stimulus bill, only a month after Congress passed a $900 billion package. COVID-19 relief elements receive support while other topics suggest a raise to the minimum wage are questioned. Nevertheless, reports in Washington suggest that the administration is set to advance the full proposal. Headlines are set to move markets. 

Tensions are rising ahead of the Federal Reserve’s decision on Wednesday. The bank is set to leave rates unchanged and rule out any early tapering of its bond-buying scheme. 

Coronavirus: Global cases are nearing 100 million and fears of strains are competing with hopes that the vaccine provides an exit from the crisis. The US is set to enact a travel ban on South Africa, fearing the variant. The UK’s controversial policy of delaying the second vaccine jab could be copied by other countries and France is set to enter a new nationwide lockdown. Johnson and Johnson are set to report results from its one-shot covid vaccine during the week. 

Coronavirus: Statistics, herd immunity, vaccine calendar and impact on financial markets and currencies

The euro is also edging up against the dollar, albeit lagging behind its peers. The German IFO Business Climate is set to edge lower in the report for January. Christine Lagarde, President of the European Central Bank, is scheduled to speak later in the day after leaving the bank’s policy unchanged last week. 

Cryptocurrencies: Ethereum stood out with a surge to new highs near $1,500, while Bitcoin is trading around $33,000.

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