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Forex Market Majors Improve as EU Leaders Edge Closer to Deal

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Forex Market Majors Improve as EU Leaders Edge Closer to Deal
  • EUR/USD Market Boosted by Improved Deal Hopes
  • GBP/USD Fighting Back as Brexit Talks Resume
  • Vaccine Trial Data Could Influence Markets

Both the EUR/USD, and GBP/USD major pairs started the week on a positive note. This as the forex market looks to recover from a poor ending to last week, particularly where these two are concerned. A lot still hangs in the balance on Monday though. This includes the possible EU rescue fund deal which is still being discussed as critical Brexit talks are also set to resume. As COVID-19 case numbers continue to rise, today’s publishing of medical trial data from AstraZeneca becomes an even more key event.

Traders Hopeful Rescue Fund Deadlock Will be Broken

The EUR/USD market was improving today, with many forex traders forecasting a break through 1.15 later in the day. This more positive move has been brought on, not by any significant or certain news from the talks, but the hope that a deal to appease the so-called “frugal four” is getting closer.

Entering the fourth day of intense talks still without agreement, information suggests that the nations who have so far stood firm in opposition to the €750 billion deal, are getting closer to compromise. It is thought that they would agree to such a deal at no more than €400 billion. This would represent a significant cut to the original proposal, but any deal to stimulate the economy will be a positive one for the Euro and the region. A deal breakthrough would very likely see a lot of positive activity for forex brokers in this market.

Pound Also Trading More Positively Amid Brexit Talks

Sterling has also strengthened slightly to start the week. The pair is now trading closer to the 1.26 mark with many issues at play in the UK. The first of these is the resumption of Brexit talks which have so far proven fruitless. Any positive breakthrough here would be a great bonus for the Pound with the market already seeming to have priced in a likely continuation of the impasse we have already seen. Worsening relations between the UK and China also do not yet appear to be impacting the market negatively.

The currency has likely benefited from news that British company Synairgen has reported very positive results from a small trial of Coronavirus patients who have experienced noticeably improved health responses when treated with the drug. Such results though, still need to be scrutinized.

Markets Await Possible Breakthrough Vaccine Data

Another source of strength for the Pound, and perhaps global markets in general today, also comes in vaccine form. Prestigious medical journal the Lancet are set to publish key data on one of the most high-potential vaccines from AstraZeneca which was developed in collaboration with Oxford University.

This data release will be watched very closely and could be a key moment for the day’s trading as futures on Wall Street struggle to keep pace with the gains of the last week.

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Anthony is a financial journalist and business advisor with several years’ experience writing for some of the most well-known sites in the Forex world. A keen trader turned industry writer, he is currently based in Shanghai with a finger on the pulse of Asia’s biggest markets.

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