News: Trump takes measures for economic relief. Will they help?

Monday, August 10, 2020

Trump takes measures for economic relief. Will they help?

The President lost his patience

Hello! My name is Nicholas. I am a financial analyst from the OctaFX team.

This week, we should pay special attention to the U.S. dollar as the release of recent statistics and executive decisions may significantly impact its price.

The negotiations regarding the new stimulus package for the U.S. economy failed in Congress last week. President Trump followed up the failure of the bill, announcing measures to bypass Congress. President Trump said, he has ordered to provide 'an additional 400 USD a week in extended payments' to the uneployed citizens. Democrats are furious with this decision and have called on Republicans to head back to the negotiating table because these measures would have almost no immediate impact.

Friday's payroll report, while better than expected, still does not demonstrate that the U.S. economy will be recovering soon.

Markets were further impacted by President Trump when he disclosed bans of Chinese apps, WeChat and TikTok. China responded to the actions by stating that these companies followed American laws and warned that the U.S. would have to 'take responsibility' for its actions.

Upcoming news

10 August

Monday

CNY: Consumer Price Index

11 August

Tuesday

GBP: ILO Unemployment Rate (3M)

12 August

Wednesday

NZD: RBNZ Rate Statement

GBP: Gross Domestic Product

USD: Consumer Price Index Ex Food & Energy

13 August

Thursday

AUD: Unemployment Rate
EUR Harmonised Index of Consumer Prices

14 August

Friday

CNY: Retail Sales

EUR: Gross Domestic Product

USD: Retail Sales

USD: Reuters/Michigan Consumer Sentiment Index

Market sentiment

Indices

The Nasdaq-100 index is attempting to recover this morning after falling 2% last Friday. The S&P index is at its pre-pandemic highs and poised to climb higher.

Currencies

The U.S. dollar continues to strengthen somewhat versus the euro, pound, and yen. Investors remain focused on a possible stimulus bill in the U.S. Congress.

Gold

The Gold 'rush' has subsided and nearly achieving 2,080 USD. The price has since dropped to around 2,030 USD. Gold is likely to stay above 2,000 in the mid-term. If not, we can expect it to fall towards 1,975 USD.

Oil

Oil prices rose Monday, aided by Saudi Arabia's optimism of newfound Asian oil demands and Iraq's promise to reduce production. Although, uncertainty over a deal to strengthen the U.S. economic recovery has limited its growth.