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Forex traders were once again in a bearish mood on the U.S. dollar, this time arguably on net negative economic updates, continued stimulus hopes, and optimism of a recovery from continued positive vaccine headlines.

Overlay of USD Pairs: 1-Hour Forex Chart
Overlay of USD Pairs: 1-Hour Forex Chart
USD Weekly Performance from MarketMilk
USD Weekly Performance from MarketMilk

United States Headlines and Economic data

Monday:

Federal Reserve says key bank lending rate will be phased out by June 2023,  replaced by the Secured Overnight Financing Rate.

Congress Confronts Deadlines on Spending, Stimulus and Shelton – Lawmakers have only a few weeks to wrap up work before the year-end holidays, amid the continuing distraction from President Donald Trump’s unfounded claims about the presidential election he lost to President-elect Joe Biden.

October U.S. pending home sales fall unexpectedly, as high prices take their toll on buyers – Pending home sales fell 1.1% month to month in October but were 20.2% higher compared with October 2019.

Chicago PMI eased to 58.2 in November vs. 61.1 in October – “New Orders and Production posted the only declines, while Supplier Deliveries saw the largest gain.”

Arizona certifies election win for Biden over Trump

Treasury’s Mnuchin urges Congress to tap unused CARES Act funds ($455B) for COVID relief – “Based on recent economic data, I continue to believe that a targeted fiscal package is the most appropriate federal response,” Mnuchin said in prepared testimony to the Senate Banking Committee released ahead of a hearing scheduled for Tuesday.

Fed’s Barkin Says U.S. Economy Holding Up Amid Virus Resurgence – ‘’It’s hard to find a huge drop in the real-time data,” Barkin told reporters Monday in a press briefing before a University of South Carolina virtual speech. “I’m thinking about credit-card spending which I get to see every week. It really hasn’t taken a step back yet.”

Texas factory activity expanded in November for the sixth consecutive month, though at a markedly slower pace – The production index, a key measure of state manufacturing conditions, fell from 25.5 to 7.2, indicating a deceleration in output growth.

Tuesday:

Steepest improvement in U.S. operating conditions since
September 2014 – The seasonally adjusted IHS Markit final U.S. Manufacturing Purchasing Managers’ Index posted 56.7 in November, up notably from 53.4 in October and matching the earlier released ‘flash’ estimate.

ISM Manufacturing PMI declined to 57.5 in November from 59.3 in October

US construction spending jumps 1.3% in October vs. a downwardly revised -0.5% (from +0.3%) in September

Fed’s Daly says not yet time to stimulate economy aggressively because it would be unsafe. This suggests that the Fed may hold off on any changes to policy at their meeting this month.

Senate Testimony Shows Rift Between Treasury and Fed as their views differed on the state of the U.S. economy in the months ahead.

Powell, Yellen call on Congress to boost economy as lawmakers seek deal

McConnell shoots down bipartisan $900 billion coronavirus stimulus plan as stalemate drags on

Fed’s Brainard Says More Fiscal Aid Needed to Prevent ‘Scarring’

Wednesday:

U.S. private payrolls miss expectations in November; 307K vs. 410K forecast – “The leisure and hospitality sector, hardest hit by the coronavirus pandemic, added 95,000 jobs. Construction employment increased by 22,000 jobs and manufacturers hired 8,000 workers. There were employment gains in financial activities, professional services, education and healthcare sectors. The information industry added no jobs.”

Biden will carry Georgia after second recount: secretary of state

Fed’s Quarles says banks should be encouraged to increase lending

Powell says no rift with Mnuchin, signals Fed not stepping back

Fed’s Harker: U.S. economy ‘plateauing’ because of virus, lack of fiscal help – “Harker said he is expecting “moderate growth for the rest of this year and the first quarter of 2021″ and for the economy to stay below pre-pandemic levels.”

Feds Beige Book sees little to no growth in much of U.S. as stress mounts – Fed officials seemed to signal that the winter slowdown they’ve feared would follow a new coronavirus outbreak is taking root.

Pelosi and Schumer back $900 billion coronavirus stimulus plan as basis for negotiations

Thursday:

First-time claims for unemployment benefits totaled 712,000 last week, compared with 787,000 a week earlier and the Dow Jones estimate of 780,000, the Labor Department reported. – Continuing claims dropped sharply to 5.52 million.

U.S. service sector activity slows to six-month low of 55.9 in November: ISM survey

2020 November US Job Cuts Report: 64,797 in November, Up 45% From November 2019 – So far this year, 2,227,725 job cuts have been announced, 298% higher than the 559,713 cuts announced through November 2019. It is the highest annual total on record.

U.S. Congress shows support for $908 billion coronavirus aid bill

Friday:

Nonfarm payrolls increased by just 245,000 in November, well below Wall Street estimates of around 440,000

The Unemployment rate fell to 6.7% as expected

“Job gains were concentrated in warehousing as well as professional and business services. Retail jobs fell ahead of the holiday shopping season.”

U.S. trade deficit widens less than expected in October – “The Commerce Department said on Friday the trade gap rose 1.7% to $63.1 billion in October. Data for September was revised to show a $62.1 billion deficit instead of $63.9 billion as previously reported. ”

U.S. factory orders increase more than expected in October – “The Commerce Department said on Friday that factory orders rose 1.0% after increasing 1.3% in October. Economists polled by Reuters had forecast factory orders increasing 0.8% in October.”

Fed’s Evans: comfortable with current bond-buying, not opposed to more easingsays November jobs report ‘a little disappointing’