US dollarMarkets have somewhat calmed after the massive dollar sell-off and gold’s surge earlier in the week as tensions mount ahead of the Federal Reserve’s decision. US coronavirus figures, slow-moving fiscal stimulus negotiations, and vaccine hopes are all in the mix.

The US dollar is licking its wounds after a sell-off earlier this week and stocks are edging lower as speculation around the Federal Reserve’s decision is rising. The world’s most powerful central bank is set to leave its policy unchanged after its massive monetary stimulus early in the year and as it has already signalled no rate hikes at least until 2022. US coronavirus cases have stabilized around 60,000 per day while the seven-day rolling average of deaths continues climbing, topping 1,100.

EUR/USD is holding up above 1.17 benefiting from the upbeat German IFO Business Climate and the agreement on the EU fund, while concerns about rising COVID-19 cases rise. GBP/USD is above 1.29 as the UK extends its reopening. Brexit talks are going nowhere fast. USD/JPY is hovering around the 105 level, as Tokyo’s COVID-19 cases remain elevated.

Gold is stabilizing around $1,950, midway between the new high of $1,980 and the 2011 peak of around $1,921.50.

West Texas Intermediate oil is currently trading in the red near $41.15 at press time, having dropped by over 1.3% on Tuesday despite the US API reporting a surprise drop in inventories. EIA Crude Oil Stocks Change will be watched later in the day.