Forex Today: Yields lift dollar after Biden signs stimulus, gold pressured, US consumer data eyed


Here is what you need to know on Friday, March 12:

The dollar is on the rise as Treasury yields resume their gains and stocks are turning south after an upbeat Thursday. Gold and Bitcoin are also off their highs of the week. US consumer confidence and Canadian employment figures are eyed. 

Stimulus: US President Joe Biden signed the $1.9 covid bill and promised to use the funds to allow every American to get a vaccine by May. US stocks advanced on Thursday but are turning south on Friday. Checks are on their way to Americans, while yields are on the rise – returns on ten-year bonds hitting 1.60%.

Gold has been dropping from the highs amid the increase in returns on US debt, changing hands above $1,700, but only just. 

US data: Jobless claims dropped to 712,000 marginally better than expected. The University of Michigan’s preliminary Consumer Sentiment Index for March has the final word of the week, and it is forecast to edge higher. 

See US Michigan Consumer Sentiment March Preview: The post-COVID blues

EUR/USD is under pressure around 1.1950 after the European Central Bank pledged to front-load some of its bond-buying schemes and significantly increases purchases in the second quarter.  On the other hand, the ECB will not extend the plan beyond March 2022 nor expand the scope beyond €1.85 trillion. 

See ECB Analysis: Why Lagarde’s short-term fix is lose-lose for the euro

Vaccine: AstraZeneca’s jabs are under fire amid cases of blood clots in people that received doses in Europe. While some countries are clamoring for more inoculations, others have temporarily suspended distribution. European countries are behind the US and the UK in their vaccination campaigns. The silver lining is that the European regulator approved Johnson & Johnson’s single-shot jab. 

GBP/USD is trading around 1.3950, partially supported by upbeat UK Gross Domestic Product figures. The economy squeezed by 2.9% in January, better than 4.9 expected. Britain was under strict lockdown early in the year. Novavax’s UK vaccine trial has shown a 96.4% efficacy rate. 

Canada is set to report an increase in jobs in February, after losing 212,8000 positions in January. USD/CAD is hovering above 1.2550 after the Bank of Canada left its policy unchanged earlier in the year. 

Bitcoin is changing hands below $57,000, off the weekly tops but not far from all-time highs. Ethereum is below $1,800 as the world watches Non-Fungible Tokens (NFTs). A digital artwork sold for nearly $70 million in an auction, using ETH.

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