What Happened
- A new COVID variant and the Fed’s will to taper boosted the greenback by 2.0% in November
- Hesitation to tighten monetary policy and renewed medical concerns crushed the Euro
- Sterling sank to its weakest point in a year as the Omicron variant delayed interest-rate hikes
- Jerome Powell was nominated for a second term as Fed chair and no longer refers to inflation as “transitory,” aiding the buck
- Mexican Peso fell to its worst value since March 2020; Japanese Yen traded near a 2017-nadir
TEMPUS’ View
- With the infrastructure bill passed, December will test the USD on other metrics, labor data
- Many will be relieved to end a tumultuous pandemic year, but Omicron could create challenges to ongoing recovery and growth
- Uncertainty takes ahold of markets as different approaches to the new variant already witnessed per nation
- U.S. Dollar is on pace to close the year a winner with over 5.5% overall gain, but if the variant proves less troubling, the globe could rally
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