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  • US dollar remains sideways around 1.3000 after coming up from 1.2930 lows
  • Markets consolidate with the investors digesting Pfizer vaccine’s news.

US dollar’s recovery from multi-month lows at 1.2930 on Monday has been capped at 1.3050 area earlier today and the pair is struggling to confirm above the 1.3000 level, trading practically unchanged on daily charts.

USD remains flat with markets digesting COVID-19 vaccine news

The greenback is moving sideways against its main peers on Tuesday as the market assimilates Monday’s news about the promising results of Pfizer’s coronavirus vaccine. The drugmaker announced yesterday that the results of its large-scale tests have revealed that the vaccine is 90% effective, which has boosted hopes of an earlier than expected cure to the pandemic.

The Canadian dollar appreciated sharply on the back of news about a coronavirus vaccine, pushing the pair below 1.2950 for the first time in two years. The commodity-sensitive CAD advanced 0.8% against its North American counterpart buoyed by the 10% rally on crude prices after news of a coronavirus vaccine eased fears about the impact of the lockdowns on global oil demand.

The pair managed to pare loses later on as the risk rally boosted US T-Bond yields, triggering a solid USD rebound. The US Dollar Index closed the day 0.65% higher and managed to regain lost ground after having retreated about 1.72% in the previous week.

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