The British pound slipped to near 2-months low on Tuesday after Bank of England Governor Bailey warned that the recent rise in COVID-19 cases "reinforced the downside risks" facing the UK economy. On the other hand, England's chief medical officer Whitty has warned the rate of COVID-19 infections in the UK is "heading in the wrong direction" and the country is in a "critical point" in the pandemic.
The global equity markets ended sharply lower on Monday. The Dow dropped 1.9%, while the S&P 500 fell 1.2%. The technology-laden Nasdaq Composite lost 0.1%. Meanwhile, London's FTSE 100 and the CAC 40 in Paris tumbled more than 3%, while the Frankfurt DAX tanked more than 4%. Nikola (NASDAQ: NKLA) shares dropped more than 19% after founder Trevor Milton has resigned as executive chairman over fraud allegations.
Crude oil prices plunged over fears about the outlook for energy demand due to rising coronavirus cases in Europe. During the European session, the Oil prices slightly rebounded ahead of the API inventory data due later in the day.
In the currency market, the US dollar index climbed to fresh monthly high on Tuesday. The Australian dollar fell to new weekly lows after the Reserve Bank of Australia said it is assessing policy options including currency market intervention and negative rates.
The gold price hovers near $1900 zone ahead of Fed Chairman Jerome Powell speech in the US Congress.
On the US-China front, the latter's Ministry of Commerce released provisions on its so-called “unreliable entity list” a day after the Trump administration announced a ban on WeChat and TikTok.
European Commission Vice President of Interinstitutional Relations and Foresight announced on Tuesday that a joint committee between the European Union (EU) and the UK on the Brexit issue will take place on September 28.
The number of people infected with the coronavirus across the world surpassed 31.3 million, of which at least 964 thousand people have died and 21.5 million have recovered, according to data released by the Johns Hopkins University. Former Food and Drug Administration Commissioner Scott Gottlieb warned the US may experience “at least one more cycle” of the virus in autumn and winter.
GBP/USD: The currency pair slightly rebounded from the early session low of 1.2710, at the time writing the British Pound hovers near 1.2800 zones.
The important levels to watch for today: Support- 1.2770 and 1.2710 Resistance- 1.2830 and 1.2870.
GOLD: The yellow metal trading above $1900 on Tuesday after the yellow metal dropped more than 3% on Monday.
The important levels to watch for today: Support- 1890 and 1880 Resistance- 1910 and 1920.
Quote of the day: keeping your ear to the ground in the markets is a sound investment – Amah lambert.
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