The price of gold reportedly rose by about 0.1%. This means that one of the main commodities walked into the area of $1,899 per troy ounce yesterday morning. The note is due to several reasons as well as news that occurred in the market.  

President Donald Trump's request to raise $2,000 for the stimulus fund was seemed impossible to be a reality. That has come under resistance from the Republican-controlled Senate. Senate Majority Leader Mitch McConnell ultimately refused to vote to pass Trump's proposal.

This year, the price of gold has risen more than 24%. That was the best gain since 2010. The strengthening was driven by low-interest rates and for sure the amount of stimulus launched to mitigate the impact of the coronavirus pandemic that has not yet ended.

USD Still Weakens

When gold commodities increase, what about the USD? Based on data from global markets, the major currencies weakened to their lowest level since April 2018. For information, news of a new variant of coronavirus from the UK is feared to be widespread. 

Until now, California has reported the first case of infection of a new variant of the virus. Besides California, several countries also reported the same thing as Singapore, Malaysia, and others. The discourse of restrictions and lockdowns has now appeared.

As an effort to defeat the protracted pandemic, the UK became the first country to approve a vaccine yesterday. The vaccine is developed by the Universities of Oxford and AstraZeneca. It is likely that his injection into the general public will be done in the near future.

Dollar Depressed by Twin Deficits

The USD is still depressed as market participants speculate that the global economic recovery will suck funds into risky assets. Even when the United States' deficit shows a large number, it demands that the exchange rate of these major currencies weaken to this day.

The euro actually strengthened to an area of 1.2305 against the U.S. dollar. The strengthening touched its highest level since April 2018. This year, the gain even reached 10%. Technically, the next increase targets are between 1.2413 and 1.2476 where it is highly likely.

For information, the last increase was located at 1.2555 which is the highest level in 2018. Meanwhile sterling also showed a rise after the moment of agreement on a post-Brexit trade agreement with the EU. It is known that both sides have now found a consensus.

Sterling even gained to 1.36485. That is a level not seen since May 2018. Meanwhile, the dollar index plunged to 89.55 and touched its lowest level since April 2018. So far this year, the USD index has shown a weakening of 7.2%. The value is quite large.

GBP/USD Also Corrected

One of the triggers for the weakening of the USD is the "twin deficits". That thing is due to the bloating of the budget and the trade deficit. Elsewhere, the GBP/USD pair extended its weekly rally and touched its highest level since May 2018. More precisely is at the number 1.3686. 

However, ahead of the American session, the pair corrected and reversed course. They were last seen trading at 1.3640 which means gaining 0.13% daily. On Wednesday, the British parliament approved a trade deal with the UK as expected by many. 

Meanwhile, British Health Minister Matt Hancock announced that they would tighten restrictions. This is related to the development of coronavirus after confirming more than 50,000 cases on Tuesday. However, these developments failed to trigger a significant market reaction.

In fact, the weakening of the USD broadly allows GBP/USD to remain bullish. Furthermore, the weekly Initial Unemployment Claim from America will be the last data release of the year. Ahead of the release of this report, the U.S. Dollar Index recorded a small daily loss at 89.63.