US: Greater restrictions in January, a reason to sell the dollar – MUFG

FXStreet reports that according to economists at MUFG Bank, further restrictions under a Biden presidency are on the cards. 

“Risks remain elevated and news that Astra Zeneca will run an additional trial to try and validate the 90% efficacy rate in results from a portion of its trial is concerning. Clearly, the biggest single risk for financial markets now is the failure of vaccines being rolled out smoothly in Q1 2021.”

“On three days over the past week, the US has reported a daily death total over the 2,000 level. On average over the past week, the US has recorded 175K new cases per day”

“The latest available data is to Wednesday and the mobility figures were the highest for a Wednesday since 14th October. So the next few weeks could see the consequences of Thanksgiving in a further escalation of infections and deaths.” 

“There are certainly increasing calls for a national strategy to tackle the virus and it seems likely with COVID-19 figures set to be elevated when Joe Biden becomes president in January that greater restrictions are on the way. If the rest of the world is recovering by then, it could result in further reason to sell the dollar.”