The USD/EUR exchange rate remained almost steady at 0.8430 on Tuesday 17 November trading session. The DXY dollar index has declined by 0.24% to 92.42.
The week started with another announcement after large-scale studies about the high efficacy of coronavirus vaccines. This time, at 94.5 percent in stage III trials, the American company Moderna Inc (MRNA) confirmed on Monday the efficacy of its vaccine. The news follows a statement by Pfizer Inc (PFE) and BioNTech SE (BNTX) that announced last week that their jointly developed drug has shown more than 90% efficacy in the battle against coronavirus.
The dollar rose against defensive currencies such as the yen and Swiss franc, on the back of optimistic reports about a potential covid-19 vaccine. In the case of Pfizer and BioNTech, however the manufacturing and delivery logistics of the vaccine are still too precise and complicated, as the drug must be shipped at a temperature of -70 degrees Celsius. This means that in the near future, it is unlikely to be available to the general public.
Moreover the steady rise in the number of coronavirus infection cases worldwide does not contribute to optimism. Several U.S. states have recorded record numbers of cases, as well as hospitalizations and fatalities. The United Kingdom, Europe and Japan have also registered an increase in the number of cases, according to Johns Hopkins University. The number of infected people surpassed 54.8 million cases worldwide as of November 17.
There is also growing fear that the Donald Trump, will not accept the victory of new US President Joe Biden. The presidential race winner has not yet been officially declared after two weeks, which undoubtedly hinders both political decision-making and economic recovery. Against this backdrop, geopolitical uncertainty is rising, which could impact emerging market currencies and major trading partners in the United States.