There were ugly scenes in Washington DC yesterday, as a swarm of pro-Trump supporters stormed the Capitol building to stop the certification of Joe Biden’s victory. Congress was forced to abandon its plans as it became apparent a peaceful transfer of power would not take place.
Democrats were confirmed to have won control of the US Senate after Jon Ossoff won his run-off race against David Perdue. This means that the makeup of the Senate is now 50-50 with Kamala Harris able to weigh in as a tie breaker. This is excellent news for Joe Biden who will now be able to enact policy with the full support of the Senate and House.
The pound is mostly unchanged against both the euro and dollar in trading this morning. Andrew Bailey said yesterday the EU-UK Brexit deal could end up costing the U.K. £80 billion, while Parliament overwhelmingly backed England’s third lockdown as Covid-19 cases hit another record high.
The euro is slightly lower against the dollar in early morning trading today. The EU approved the Moderna vaccine, and most capitals in the continent have closed schools as Coronavirus cases surge. CPI inflation data for the Eurozone will be released this morning and is expected to hover just above the zero percent line.
The dollar is mostly unchanged against a basket of major currencies and higher against the Japanese Yen. Initial Jobless claims are released this afternoon, and lawmakers will be hoping that claims will continue to fall as they did last week, where they were below 800,000 for the first time in a month.
US futures and Asian equities climbed as it was confirmed that the Democrats have a clean sweep of Congress which boosts expectations that Joe Biden can increase fiscal stimulus with limited opposition. Treasury yields held losses on concerns that there will be a rising debt burden and faster inflation.